[Australia] Telstra to slash nearly a tenth of workforce

On May 21, Australia's leading telecommunications and technology company Telstra announced that it plans to cut up to 2,800 jobs as part of a major restructure, The Conversation reports.

Cuts of 377 staff will take immediate effect within the Telstra Enterprise business unit while details on the majority of the remaining cuts will be announced soon and finalised by the end of the year.

The announcement reportedly came in the wake of a review of Telstra’s enterprise division, which services large business and government clients.

Providing voice calls and other network services to these clients was a core part of Telstra’s business, however, recent competition from low-cost internet-based companies has hit this revenue stream.

At a press conference, Vicki Brady - Telstra CEO - said that although the company continues to see solid growth across its mobile network, it is facing a changing business landscape.

“Our industry and the world we are operating in are changing. We have new and different competitors. We have rapid advances in technologies happening. Our customer needs continue to evolve and we have ongoing inflationary and cost pressures,” Ms Brady said.

The job cuts could also reportedly be part of a strategy to boost Telstra’s flagging share price. It fell to a low of A$3.57 the day the announcement was made.

This was down from its 52-week high of $4.46 and significantly below its ten-year high of $6.61 in February 2015.

According to Telstra, its restructuring is intended to put the company in better financial shape. The announcement fails to provide clear guidance on how Telstra plans to grow its business in coming years.

The telecom giant is seeing increasing competition in a maturing market yet its growth seems, primarily, to be based on expanding its customer base rather than introducing new products and services.

For now, Telstra continues to struggle to cut costs at a time of, what it has called, “higher-than-expected inflation” and high energy costs.

Source: The Conversation

(Link and quote via original reporting)

On May 21, Australia's leading telecommunications and technology company Telstra announced that it plans to cut up to 2,800 jobs as part of a major restructure, The Conversation reports.

Cuts of 377 staff will take immediate effect within the Telstra Enterprise business unit while details on the majority of the remaining cuts will be announced soon and finalised by the end of the year.

The announcement reportedly came in the wake of a review of Telstra’s enterprise division, which services large business and government clients.

Providing voice calls and other network services to these clients was a core part of Telstra’s business, however, recent competition from low-cost internet-based companies has hit this revenue stream.

At a press conference, Vicki Brady - Telstra CEO - said that although the company continues to see solid growth across its mobile network, it is facing a changing business landscape.

“Our industry and the world we are operating in are changing. We have new and different competitors. We have rapid advances in technologies happening. Our customer needs continue to evolve and we have ongoing inflationary and cost pressures,” Ms Brady said.

The job cuts could also reportedly be part of a strategy to boost Telstra’s flagging share price. It fell to a low of A$3.57 the day the announcement was made.

This was down from its 52-week high of $4.46 and significantly below its ten-year high of $6.61 in February 2015.

According to Telstra, its restructuring is intended to put the company in better financial shape. The announcement fails to provide clear guidance on how Telstra plans to grow its business in coming years.

The telecom giant is seeing increasing competition in a maturing market yet its growth seems, primarily, to be based on expanding its customer base rather than introducing new products and services.

For now, Telstra continues to struggle to cut costs at a time of, what it has called, “higher-than-expected inflation” and high energy costs.

Source: The Conversation

(Link and quote via original reporting)