Verizon Joins T-Mobile in Layoffs As Wireless Players Feel the Pressure
Verizon has followed rival T-Mobile in laying off staff, CNET has learned. The wireless carrier would not disclose the exact number of employees it was cutting but did confirm the move had occurred.
“Throughout the year, our company makes adjustments to our headcount depending upon the needs of the business,” a company spokeswoman said in a statement. “At times we could be increasing headcount in one area while decreasing the number of employees in others. There were a small number of employees impacted by this latest adjustment, but we have no specific details to share at this time.”
The layoffs come nearly two weeks after the nation’s largest carrier announced that it lost 215,000 consumer phone accounts in the most recent quarter that ended June 30. Even with the benefit of business customers, it’s overall net gain of 12,000 subscribers paled when compared to its rivals. T-Mobile, which brought on 723,000 postpaid mobile subscribers, confirmed its own layoffs to CNET last month. T-Mobile said “most impacted employees have been offered different roles” and added that “a small number of roles have been eliminated.”
The cuts at both telecom providers, two of the largest employers in the nation, reflect the the rocky economic environment and broader tightening of the belt in corporate America. Oracle cut jobs in its US customer experience division, Bloomberg reported on Monday, while former investment darling Robinhood said it planned to cut nearly a quarter of its staff on Tuesday. Meta said last week that it had frozen some roles amid its first-ever revenue drop.
The environment is likely serving as a catalyst for price-conscious wireless consumers to start looking for deals. Verizon, for its part, attributed its recent issues to inflation and economic conditions as well as its struggle to get people to sign up for its lower-end unlimited plans. The carrier has raised the price for its older shared data plans and recently hiked rates for customers (which it said was not a result of inflation), though both charges only started to go into effect in June and it remains to be seen if more customers will defect as a result.
In a bid to appeal to budget-conscious customers, the nation’s largest carrier introduced a lower-priced “Welcome Unlimited” last month. “Our second quarter was not a good barometer for what Verizon has been, or where it’s going,” Hans Vestberg, chairman and chief executive officer, said during the company’s earnings call. “We’re not satisfied with our performance.” Verizon’s stock has fallen roughly 15% this year, compared to a 13% decline in the S&P 500.
T-Mobile has risen nearly 26%. Like Verizon, T-Mobile tried to downplay the cuts. “As we continue to hire top talent, with over 2,000 positions open, we are also making normal course-of-business organizational shifts in some areas of the company that will allow us to better focus our resources on being in the places where customers want and need us to be,” the company said in a statement. “These shifts primarily affect a small number of ‘back of house’ management and administrative roles.”