Verizon to Cut 15% of Workforce: Why the Telecom Giant Is Making Its Biggest Job Cuts Ever

Verizon is preparing for one of the largest workforce reductions in its history, with nearly 15% of employees expected to be laid off as early as next week, according to a Reuters report citing a person directly familiar with the matter. The sweeping cuts come as the US telecom major struggles to maintain competitiveness against aggressive rivals and adapt to changing industry dynamics.

The layoffs will primarily affect non-union management roles, marking a major restructuring initiative under Verizon's new CEO, Dan Schulman, who took charge in October. As part of the shake-up, around 180 company-owned retail stores are expected to be transitioned into franchise-operated outlets—another cost-saving move aimed at streamlining operations.

RISING PRESSURE FROM COMPETITIVE RIVALS

Verizon has faced consistent pressure from other telecom giants, particularly AT&T and T-Mobile, both of which continue to attract customers with cheaper plans, aggressive discounts, and promotional offers—especially during the launch cycles of new iPhones.

Cable providers like Comcast and Charter have also eaten into Verizon’s subscriber base by bundling high-speed broadband with mobile services, making it harder for traditional telecom operators to retain customers.

Schulman recently emphasised the need for Verizon to undergo a “cost transformation” and evolve into a “leaner and more agile organisation” to navigate a highly competitive telecom landscape.

CUSTOMER GROWTH SLOWDOWN AMPLIFIES CONCERNS

The company’s subscriber growth has been sluggish. In the third quarter, Verizon added only 44,000 wireless postpaid customers—far behind AT&T, while T-Mobile recorded over one million new additions.

According to analysts, Verizon’s biggest hurdle is customer retention. Many industry experts believe that retaining users may require subsidising premium smartphones, a move that could significantly increase costs.

One analyst noted that while the layoffs could help fund such subsidies, “it’s unclear whether cutting 15% of the workforce will be enough to offset the rising cost of keeping customers.”

HEAVY PAST INVESTMENTS UNDER THE MICROSCOPE

Verizon’s financial position has been weighed down by large-scale investments. These include:

• $52 billion spent in 2021 to acquire mid-band spectrum for its 5G network

• $20 billion acquisition of Frontier Communications assets

• $6 billion purchase of TracFone Wireless

While aimed at strengthening long-term competitiveness, some of these investments are now being scrutinised as subscriber growth slows and cost pressures mount.

In the past three years alone, Verizon has already reduced its workforce by roughly 20,000 employees under various cost-cutting programmes. Last year, 4,800 workers opted for voluntary separation packages that cost the company nearly $2 billion.

With the latest round of cuts, Verizon appears to be entering one of its most aggressive restructuring phases yet—aimed at stabilising finances and preserving market share in an increasingly challenging environment.