Telecommunications giant Vodafone said Tuesday it would be cutting 11,000 jobs over the next three years, after announcing poor full-year financial results.
“Our performance has not been good enough,” CEO Margherita Della Valle said in a statement. “To consistently deliver, Vodafone must change. … We will simplify our organisation, cutting out complexity to regain our competitiveness.”
The company’s financial report for the year ending in March forecast a $1.6 billion (1.5 billion euros) decline in free cash flow for this year, and the job cuts are the biggest in the firm’s history, according to Reuters.
The England-headquartered company employs about 100,000 people globally, with a large presence in Europe and Africa.
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Vodafone acknowledged the company’s “performance slowdown” and singled out “commercial underperformance” in Germany, one of its biggest markets.
It promised a “strategic review in Spain” and detailed high energy costs and “adverse exchange rate movements” among other issues facing the cellphone provider as underlying cash profit fell by around 1.3 percent to $16 billion.
However, the company reported full-year revenue had increased by 0.3 percent to about $50 billion “driven by growth in Africa and higher equipment sales.”
“We will be a leaner and simpler organisation, to increase our commercial agility and free up resources,” the financial report said.
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Della Valle was appointed in January after former CEO Nick Read stepped down at the end of 2022.
“Lacklustre performance has been something markets have come to expect from Vodafone of late, and full-year results didn’t buck the trend,” Matt Britzman, equity market analyst at the financial services company Hargreaves Lansdown, said in a statement.
“New CEO, Margherita Della Valle, has been very vocal about the host of challenges she’s facing in her new role — the honesty is refreshing but not enough to keep shares from falling,” he added. “Markets will need to see tangible results over the coming year before they get more excited.”