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The news comes after Telefónica shifted its company focus towards cost-cutting earlier this month
Spanish mobile operator Telefónica has officially made representatives of the labour union aware of its intention to cut jobs in Spain.
“Next week the negotiating tables on these redundancies will be set up and the official number of workers affected will be communicated,” an UGT spokesperson told Reuters.
Reports vary on the exact number of jobs set to be lost, but Spanish newspaper Expansion said Telefónica intends to reduce its 21,000-strong Spanish workforce by 2,500 people, while Cinco Dias suggests as many as 3,000 jobs could be at risk.
The personnel cuts are part of Telefónica’s wider strategy to reduce capital spending, increase revenue, and cut costs to boost profitability.
Back in July, Telefónica announced its intention to return its focus to concentrate on cash generation, following many years of company restructuring. This new strategic outlook was presented at the company’s capital markets day earlier this month.
“Telefónica is moving towards a new vision of the company with its 2023–2026 plan, a new model of operational excellence based on three pillars: Growth, Profitability and Sustainability,” said José María Álvarez-Pallete, Chairman of the company, in Telefónica’s 2023 Q2 earnings report.
The main financial targets of the 2023–2026 plan are to achieve an annual revenue growth of approximately 1%, EBITDA growth of 2%, an operating cash flow (EBITDAaL – CapEx) of 5%, and a free cash flow of over 10%.
Telefónica is not alone in announcing job cuts recently, with the current global economy tearing into revenues worldwide. Just last month, Nokia announced the axing of 14,000 jobs by 2026, while Ericsson announced the cutting of 8,500 jobs this year.
BT and Vodafone have both also announced job cuts in the UK.
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