Vodafone's new CEO axes 11,000 jobs in fresh tech cull

LONDON: British mobile phone giant Vodafone on Tuesday said it planned to axe 11,000 jobs over the next three years as new chief executive Margherita Della Valle seeks a “simpler” organisation.

“Our performance has not been good enough,” Della Valle said alongside news of flat annual revenue at the group.

At 11,000 positions, Vodafone is seen axing more than 10 percent of its global workforce, which stood at 104,000 staff last year.

“To consistently deliver, Vodafone must change,” Della Valle added in a statement.

“We will simplify our organisation, cutting out complexity to regain our competitiveness,” added Della Valle, appointed CEO on a permanent basis at the start of May after five months as interim boss.

Vodafone’s announcement follows the axing this year of tens of thousands of jobs across the global tech sector, including by Facebook parent Meta, as soaring inflation weakened the economy.

Della Valle’s predecessor Nick Read stepped down in early December after a four-year tenure marked by a steep fall in the company’s share price.

He left with Vodafone in talks over merging its UK operations with rival Three UK, owned by Hong Kong-based CK Hutchison.

Media reports say a deal worth £15 billion ($18.7 billion) is close to completion.

Vodafone on Tuesday added that group revenue stood at 45.7 billion euros in its financial year to the end of March, almost flat compared with 2021/22.

It added that net profit surged to 11.8 billion euros from 2.2 billion, reflecting its part-disposal of European mast division, Vantage Towers.

“We will be a leaner and simpler organisation, to increase our commercial agility and free up resources,” the company said Tuesday.

It announced “11,000 role reductions planned over three years, with both HQ and local markets simplification”.

Vodafone, which has more than 300 million mobile customers in Europe and Africa, is heavily focused on accelerating rollout of 5G in the UK.

It is banking on the merger of its UK operations with Three to expand broadband connectivity to rural communities and small businesses.

The rollout of faster 5G connectivity has been hampered by Britain’s ban on the Chinese giant Huawei from involvement in the technology.

Following Tuesday’s announcements, shares in Vodafone dropped 2.9 percent to 87.42 pence at the start of trading on London’s benchmark FTSE 100 index, which was slightly higher overall.

At the end of 2022, Vodafone unveiled a blockbuster deal with investment firms GIP and KKR to form a joint venture that would maintain its majority stake in Vantage Towers.