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Tag: Layoffs

  • Telefonica to Cut 6,000 Jobs in 2025 Amid Restructuring Plans

    As the Spanish telecom juggernaut prepares for a comprehensive strategy overhaul in November, Telefónica is thinking of laying off up to 7,000 employees. Although the business has not yet finalised the details, a Reuters official and internal sources both say that staff reductions are being considered.

    On November 4, Executive Chair Marc Murtra is anticipated to present a new strategic direction. The majority of the proposed cuts are aimed at Spanish operations, including IT, broadband, and mobile services, and they may even make their way to Telefonica’s central offices for the first time.

    After the next negotiations with unions, any employment actions would begin. The company hopes to reach an agreement by December 31 so that associated expenses can be included in the financials for the next year.

    Layoffs Can Prove Profitable for Telefónica

    In the midst of continuous digital changes, telecom companies’ attempts to optimise operations have been constantly monitored by investors. Given that Telefónica’s net debt is currently close to €27 billion, implementing layoffs could increase profit margins and free up money for much-needed network upgrades or debt reduction.

    If the cuts appear credible, shares might respond favourably, but the true effect will rely on the final magnitude, voluntary adoption, and the rate at which the savings are converted into profits.

    The Spanish corporation and its subsidiaries, Telefonica Moviles (the company’s mobile and broadband subsidiary in Spain) and Telefonica Soluciones (which provides outsourced IT services), are expected to account for the majority of the impacted employees, up to 5,000, according to the media reports. Employees at the corporate centre, who were previously exempt from redundancy plans, could also be impacted.

    Troublesome Time for Europe’s Telecom Sector

    Due to stagnant revenue and growing infrastructure expenses, major telecom companies in Europe are reevaluating everything from strategy to workforce. The sector as a whole is moving towards leaner, more tech-driven companies, as seen by Telefonica’s possible layoffs and extensive restructuring.

    Such actions might set the tone for future employment cuts and investment strategies throughout the continent, as traditional revenue streams are under strain and competition is intensifying.

    Quick Shots

    •Telefónica plans to lay off up to 7,000 employees
    in 2025 amid a major strategic overhaul.

    •Executive Chair Marc Murtra to present new strategy
    on Nov 4; layoffs may start after union negotiations.

    •Majority of cuts expected in Spain, impacting IT,
    broadband, mobile services, and possibly corporate offices.

    •Layoffs aim to improve profit margins, reduce debt
    (€27B net debt), and free funds for network upgrades.

    •Potential positive market reaction depends on final
    cut size, voluntary adoption, and savings-to-profit conversion.

    •Subsidiaries Telefónica Moviles and Telefónica
    Soluciones expected to bear up to 5,000 layoffs.

     

  • White House Warns of Mass Layoffs as U.S. Government Shutdown Deepens

    The White House has issued a warning that if US President Donald Trump determines that talks with congressional Democrats to resolve a partial government shutdown have come to a standstill, mass layoffs of federal employees may start.

    White House National Economic Council Director Kevin Hassett told CNN’s State of the Union show on 5 September, as the shutdown reached its fifth day, that he thought there was still a chance Democrats would give up and prevent what may turn out to be an expensive political and economic catastrophe.

    “President Trump and Russ Vought are lining things up and getting ready to act if they have to, but hoping that they don’t,” Hassett added, referring to the White House budget director. Layoffs will begin if the president determines that the negotiations are completely failing.

    Trump Termed it as ‘Democratic Layoffs’

    “Anybody laid off, that’s because of the Democrats,” Trump told reporters on 5 September, referring to the possible layoffs as “Democrat layoffs”. Despite the ongoing government shutdown, Trump was present at a US Navy anniversary event in Norfolk, Virginia, on September 5. “I think the show has to go on!” Before leaving the White House for Naval Station Norfolk, Trump posted on Truth Social that it was “a show of Naval aptitude and strength.”

    However, Trump accused Democrats of inciting the shutdown and attempting “to destroy this wonderful celebration of the US Navy’s Birthday”, putting the occasion at risk of becoming embroiled in partisan hostilities. Since Trump’s last meeting with congressional leaders, no substantive talks have taken place. The standoff started on October 1, the first day of the federal fiscal year, when Senate Democrats rejected a short-term funding plan that would have kept government departments operating until November 21.

    Senate Democratic leader Chuck Schumer stated on the CBS show Face the Nation that only new negotiations between Trump and legislative leaders could break the impasse, saying, “They’ve refused to talk with us.” Democrats are calling for guarantees that the White House will not unilaterally reduce expenditure agreed upon in any agreement, as well as a permanent renewal of the enhanced premium tax credits under the Affordable Care Act (ACA).

    Till Now No Conclusive Decision Taken

    In an attempt to break the impasse, rank-and-file senators from both parties have had informal discussions on spending and healthcare, but little has changed. When asked if senators were closer to reaching an agreement, Democratic Senator Ruben Gallego responded to CNN, “At this point, no.” On 6 September, the Senate will vote once more on two duelling financing measures, one supported by the Democratic-led House and the other by Republicans.

    However, neither one is anticipated to receive the 60 votes needed to move forward. As long as the shutdown lasts, around 750,000 federal employees could be placed on furlough, with an estimated $400 million in lost wages every day, according to the Congressional Budget Office. The 2019 Government Employee Fair Treatment Act guarantees backpay to federal employees, but payments won’t start until the closure is finished.

    Quick Shots

    •Shutdown entered its fifth day
    after Senate Democrats rejected a short-term funding bill on Oct 1.

    •President Trump blames
    Democrats, calling potential furloughs “Democrat layoffs.”

    •White House officials say
    layoffs will begin if talks with Democrats completely break down.

    •No substantive negotiations
    have occurred since Trump’s last meeting with congressional leaders.

     

  • Renault to Cut 3,000 Jobs Through Voluntary Exit Scheme Amid Cost-Cutting Drive

    According to reports, the French automaker Renault intends to implement a voluntary redundancy scheme, which allows workers to opt out of the firm in exchange for a financial settlement rather than being fired outright, to lay off 3,000 workers globally, mostly in support positions. According to the French newsletter L’Informe, the final decision regarding the layoff is anticipated to be taken by the end of the year.

    Why Renault Opted to Reduce the Workforce?

    The layoffs are a part of an internal cost-cutting programme called “Arrow”, which aims to slash Renault’s staff in support services like marketing, finance, and human resources by 15%. Around 3,000 jobs are anticipated to be lost as a result of this goal at the automaker’s headquarters in the Boulogne-Billancourt area of Paris as well as other sites across the globe.

    As per Reuters, Renault said that it is thinking about cutting costs but said that no definitive decisions have been made as of yet; therefore, it was unable to confirm any official statistics.

    According to a Renault representative who replied to Reuters, “We confirm that we are considering ways to simplify our operations, speed up execution, and optimise our fixed costs given the uncertainties in the automotive market and the extremely competitive environment.” At the end of 2024, Renault had 98,636 employees across the globe.

    Financial Outlook of Renault

    This recent development comes after Renault’s financial report from July, which showed a net loss of 11.2 billion euros ($13 billion) for the first half of the year, including a write-down of 9.3 billion euros on partner Nissan. The company’s net income, excluding the write-down, dropped to 461 million euros, which was less than one-third of the profit recorded the previous year.

    A weakening van market, the cost of electric vehicles, and growing commercial pressures from a more competitive environment were all blamed for this fall. Following Luca de Meo’s departure for Gucci-owner Kering in July, Francois Provost was selected as the new CEO, and analysts emphasised the crucial work that lies ahead for him.

    The provost’s responsibilities include bringing Renault’s credit rating back to investment grade, recovering profits, and figuring out how the relatively tiny automaker can handle the effects of US tariffs and fierce competition, especially from Chinese automakers.

    Quick
    Shots

    •Renault plans to cut 3,000 jobs globally through a
    voluntary exit scheme as part of a cost-cutting drive.

    •Job cuts will primarily affect support functions
    like marketing, finance, and HR under the “Arrow” restructuring
    plan.

    •The move aims to reduce workforce by 15% in support
    roles and streamline operations amid intense market competition.

    •Renault reported a €11.2 billion net loss in H1 2025, including a €9.3
    billion write-down linked to Nissan.

    •Falling profits, weak van sales, and rising EV
    costs have intensified financial pressures.

    •New CEO Francois Provost faces challenges including
    restoring credit ratings and tackling global competition.

  • Google Layoffs Over 100 Design Jobs Amid AI-Focused Restructuring

    According to a CNBC story, Google has let go of over 100 workers in design-related positions. Employees in the cloud division’s “platform and service experience” and “quantitative user experience research” teams, as well as a few other departments, were impacted by the layoffs that occurred earlier this week.

    These positions are renowned for using data, surveys, and research to analyse user behaviour in order to inform product design. According to the report, many of the job losses affected US-based staff, and some cloud design teams saw their numbers cut in half. Some impacted employees have been given until the beginning of December to look for other positions within Google.

    Layoffs Part of Google’s Restructuring Programme

    The most recent round of layoffs is a component of Google’s continuous reorganisation as it makes greater strides towards artificial intelligence. The business has been investing more in AI infrastructure and reallocating resources from some positions to those it believes are more important for expansion.

    More than 200 contractors who worked on AI tools like Gemini and AI Overviews were also let go, according to an article published by Wired last month. Workers’ worries about poor pay, job insecurity, and escalating conflicts between employees and management were brought to light in that report. Some workers claimed that protests over working conditions were the reason behind the job losses.

    The design teams’ layoffs are not an isolated incident. In order to concentrate on areas that are essential to our business and secure our long-term success, Google cut employees in its cloud division earlier this year.

    Google Making Small Changes to Improve Collaborations

    Google stated in remarks to Reuters that it is implementing “small changes” across all teams to enhance customer service and teamwork. However, a variety of departments have been impacted by these developments. Employees in the fields of human resources, hardware, search, advertising, marketing, finance, and commerce have been eligible for voluntary leave packages since the start of 2025.

    Additionally, Google has been reducing the number of management tiers. Reports state that the organisation has cut middle managers—especially those in charge of small teams—by more than a third. The company’s ambition to expedite decision-making and optimise operations while allocating resources to AI development is reflected in the restructuring. Google is still one of the biggest employers in the tech industry in spite of the layoffs.

    According to a February regulatory filing, the corporation has 183,323 employees as of December 2024. The recent layoffs are a part of a larger trend in the tech sector, where a number of businesses are laying off employees in order to minimise expenses and redirect funds to automation and artificial intelligence.

    Quick
    Shots

    •Many affected employees were US-based; some cloud
    design teams saw headcount halved.

    •Some impacted staff have until early December to
    find other positions within Google.

    •Layoffs align with Google’s shift toward AI,
    reallocating resources to priority areas.

    •Over 200 AI tool contractors (e.g., Gemini, AI
    Overviews) were also let go earlier.

  • TCS to Offer Up to 2 Years’ Severance Pay as Part of Major Workforce Restructuring Plan

    As the Indian IT giant reduces people in response to changing customer demands and increasing automation, IT juggernaut Tata Consultancy Services (TCS) is providing severance compensation of up to two years’ salary to long-serving employees whose skills no longer match corporate needs.

    In an effort to become more flexible and future-ready in the face of swift technological advancements, Moneycontrol announced in July that it will lay off 2% of its personnel, or around 12,000 workers, over the course of the following year.

    Restructuring Plan Aims to Affect Less Skilled Employee

    According to a number of media sources, the restructuring mostly impacts workers whose skills have become outdated or who haven’t upgraded to suit changing customer needs. Employees in this category are eligible for a three-month notice period under the programme, followed by a severance compensation that, depending on duration, can range from six months to two years’ salary.

    According to a media report, six months is the lowest amount of severance pay in this category. Those who have been looking for a job for more than eight months are given a more basic package that includes three months’ worth of notice pay.

    According to the company’s statement, individuals impacted by our recent drive to realign talents have received the care and assistance that is appropriate for them in each of the unique circumstances, in accordance with our company’s values.

    TCS Also Offering Career Transition

    Additionally, the exporter of IT services offers outplacement services to assist with career transitions, paying agency fees for three months, and occasionally longer for junior associates. According to insiders, the business occasionally also provides funding for access to therapists or mental health help through its “TCS Cares” programme.

    Additionally, according to sources, the corporation is offering early retirement choices to workers whose retirement is due. These workers will have access to all retirement benefits, including insurance, as well as extra severance compensation that will vary in value from six months to two years’ salary, depending on their employment.

    According to reports, the majority of the labour modifications were finished in August and September amid considerable discontent. Employees without roles are still only being reviewed in isolated circumstances; they have the opportunity to join the Resource Management Group (RMG) to investigate roles throughout the organisation.

    Quick Shots

    •Around 2% of
    the workforce (around 12,000 employees) to be laid off over the next year.

    •Restructuring
    primarily affects employees with outdated skills or those not aligned with
    changing client demands.

    •Impacted
    employees get a 3-month notice period plus severance pay ranging from 6
    months to 2 years’ salary, depending on tenure.

    •6 months’ pay,
    while those job-hunting over 8 months receive a basic package including
    notice pay.

    •TCS
    offering career transition support, including outplacement services and
    paying agency fees for 3+ months.

  • Lufthansa to Cut 4,000 Jobs Over Next 5 Years Amid Cost-Saving Plan

    In an effort to decrease expenses and adjust to new technology, the German airline firm Lufthansa has stated that it will lay off 4,000 employees by 2030, the majority of whom will be in Germany, according to news agency AFP. Rather than operational professions like pilots, cabin crew, or ground staff, the majority of the job cuts will impact administrative roles.

    Approximately 103,000 individuals are currently employed by the organisation worldwide. Eurowings, Austrian Airlines, Swiss, Brussels Airlines, and ITA Airways—which it recently purchased to become Italy’s new flagship carrier—are all part of its network.

    Lufthansa Layoffs Align with Weakening German Economy

    Germany is currently experiencing its second year of recession at the time of the announcement. While the nation’s large corporations are finding it difficult to cope with growing energy costs, competition from China, and sluggish adoption of new technologies, unemployment has reached its worst level in a decade.

    There are other German behemoths cutting employees besides Lufthansa. The industrial engineering and technology giant Bosch announced a few days ago that it will eliminate 13,000 jobs globally, or 3% of its staff.

    AI and Digitisation Core Reason for Lufthansa Layoffs

    The decision was a part of a larger evaluation of Lufthansa’s operations, the airline stated in its statement. According to the airline, the Lufthansa Group is evaluating whether operations, such as those involving duplication of effort, will no longer be required in the future. It further stated that many areas and processes will become more efficient as a result of the significant changes brought about by digitalisation and the growing use of artificial intelligence.

     This implies that a certain amount of human interaction will no longer be necessary for some administrative duties. In addition to the reorganisation, Lufthansa has established new financial goals for 2028–2030. During this time, the corporation wants to reach an adjusted operating margin of 8% to 10%.

    The company’s efforts to stay competitive in the rapidly evolving aviation sector and get ready for a challenging economic climate in Germany and Europe are reflected in the job losses.

    Layoff has Become a Common Scenario in 2025

    With big companies like Google, Microsoft, and others continuing to reduce their workforces, layoffs in the tech sector are not expected to halt in 2025.

    Companies are still cutting employees in an effort to simplify operations, save money, and emphasise automation and artificial intelligence, even though these figures are much lower than the major layoffs that occurred between 2022 and 2023.

    Layoffs.fyi, a website that tracks layoffs in the industry, reports that 93 organisations have laid off nearly 23,500 tech workers so far this year, and the number is still growing. Google and Microsoft are apparently contemplating a new round of layoffs, according to the most recent job reduction reports.

    According to reports, AI-led restructuring and performance-based terminations are part of the corporations’ goals to increase the effectiveness of their personnel.

    Quick
    Shots

    •Cost-cutting, digitisation, and
    adoption of AI automation to streamline operations.

    •Majority of job cuts in Germany,
    where Lufthansa employs most of its 103,000 staff worldwide.

    •Germany in second year of recession;
    unemployment at a 10-year high; energy costs and China competition add pressure.

    •Bosch also cutting 13,000 jobs
    globally.

  • Accenture Lays Off 11,000 Employees, Cautions of More Job Cuts Ahead as AI Reshapes Workforce

    In just three months, Accenture has secretly reduced its workforce by almost 11,000 workers, and the axe may not be hanging down anytime soon. The mammoth consulting firm is currently undergoing a comprehensive transformation aimed at equipping it for a future in which artificial intelligence—rather than human consultants—will increasingly guide the ship.

    The Dublin-based company announced specifics of a reorganisation plan for $865 million (about INR 7,669 crore) a few days ago, alerting analysts that more layoffs will be unavoidable if employees cannot be retrained quickly enough. The company’s management, under the direction of CEO Julie Sweet, has said unequivocally that while reskilling is still the best option, not all workers will be promoted.

    Accenture Aims for Financial Gains via Layoffs

    Three months prior, Accenture had 7,91,000 employees worldwide; by the end of August, that number had dropped to 7,79,000. The financial reasoning is obvious. In the most recent quarter alone, severance and associated expenses totalled $615 million, and a further $250 million is anticipated for the current quarter. After everything is said and done, the corporation anticipates that the restructuring will result in savings of over $1 billion.

    Even though it is still among the biggest professional services companies globally, the gradual reduction in staff is anticipated to last until November 2025. Remarkably, Accenture has not disclosed the exact number of positions directly associated with this reorganisation strategy. Nevertheless, the severance expense shows that the impact is substantial and will spread to its operations across the globe.

    Accenture Betting High on AI

    Accenture is increasing its investment in artificial intelligence while simultaneously reducing its human personnel. According to the corporation, generative AI initiatives accounted for $5.1 billion of new bookings in the just-concluded fiscal year, up from $3 billion in the previous year. Its willingness to actively alter its staff can be explained by that kind of growth.

    The company currently employs 77,000 AI and data workers, which is almost twice as many as it had two years ago, Sweet noted. Accenture views these “reinventors” as the cornerstone of its future. Sweet emphasised that personnel reductions are the backup plan in case upskilling doesn’t work.

    The approach is in line with a larger trend in the consulting and IT services industry, which is challenging the traditional paradigm of armies of consultants parachuting into client offices. US federal contracts are declining, corporate clients are reducing their budgets, and Accenture and its competitors cannot ignore the allure of AI-powered efficiencies.

    Quick
    Shots

    •Layoffs are part of a $865 million
    reorganisation plan, projected to save over $1 billion in costs.

    •Employee count dropped from 791,000
    to 779,000, with cuts continuing until November 2025.

    •Generative AI initiatives brought in
    $5.1 billion in new bookings, up from $3 billion the previous year.

    •Company emphasizes upskilling
    workers, but layoffs will proceed if retraining fails.

  • Bosch to Cut 13,000 Jobs Worldwide in Major Restructuring Plan

    One of the biggest layoffs in Germany’s automotive industry, Bosch plans to eliminate 13,000 positions as the sector struggles with low demand, overcapacity, and growing competition from China. The largest auto supplier in the world announced on 25 September that all of the layoffs would be made by its own employees, which accounts for roughly 10% of its workforce in Germany and 3% worldwide.

    According to Le Monde, the layoffs are intended to save €2.5 billion a year in its auto parts division. Bosch, a manufacturer of sensors, brakes, and steering systems, stated that the cuts were required to match production to changing demand around the world.

    Bosch’s head of industrial relations, Stefan Grosch, informed reporters that the company’s products are becoming much more popular outside of Europe. The brand must align with the locations of its customers and marketplaces.

    Bosh’s Challenging Times in Europe

    The action highlights the pressure on the biggest economy in Europe as its main auto industry battles the switch to electric vehicles. Le Monde claims that slow EV sales, overcapacity in conventional components, and a growing price war in China that has reduced supplier profits have all hurt Germany’s auto industry.

    Bosch’s head of electrified motion, Marco Zehe, acknowledged that the company had misjudged the rate of change. He claimed that “electromobility has not taken off as quickly as forecast.” “That indicates that we have a lot of excess capacity, especially in Germany and Europe.” Since last year, Bosch has already announced 9,000 job layoffs.

    Schaeffler and Continental, among other suppliers, have also reduced their workforce by thousands of workers. Volkswagen has stated that it plans to reduce its staff in Germany significantly, while Porsche slowed its deployment of electrified vehicles last week due to insufficient demand.

    Bosh Struggling to Deal with Europe’s Fading Economy

    As a result of the transition, Bosch’s German operations, which were previously a cornerstone of global supply, are now disproportionately susceptible to increased cost bases and weakening European demand. “We stand by it as a location and stand by Europe and are doing all we can to continuously improve our competitiveness by our own efforts,” Grosch said, emphasising that Germany remained “central” to the company’s future.

    Representatives of the workforce pledged to oppose the reorganisation. The Bosch Mobility Works Council’s chairman, Frank Sell, called the layoffs “historically unprecedented”. He charged the group with betraying the confidence of the workers who had contributed to the company’s success. The union is requesting guarantees that Bosch won’t shut down entire German facilities, a worry that has stoked dissatisfaction among employees in industrial hotspots like Baden-Württemberg.

    With hundreds of thousands of workers, Germany’s automobile industry has been a major contributor to its export power. However, suppliers and manufacturers alike are being forced to reconsider their footprints due to the twin challenges of electrification and global competition. According to Bosch’s announcement, the adjustment will be more severe than most people had expected.

    Local economies that are already struggling from past layoffs will be affected by the employment reduction. The layoffs, according to analysts, highlight a structural change: German auto suppliers run the risk of losing market share as automakers prioritise regional sourcing and as Asian competitors take control of EV supply chains.

    Quick
    Shots

    •Layoffs aim to save €2.5 billion
    annually in the auto parts division amid falling demand and overcapacity.

    •Bosch says its products are gaining
    traction outside Europe and must realign production accordingly.

    •Slow electric vehicle adoption,
    excess capacity, and a China-led price war pressure German auto suppliers.

    •Other giants like Schaeffler,
    Continental, Volkswagen, and Porsche are also scaling back jobs and EV plans.

  • Starbucks to Shut Hundreds of Stores and Cut 900 Jobs in Major Turnaround Strategy

    Starbucks announced on 25 September that it is cutting off 900 non-retail workers and closing hundreds of outlets across the United States, Canada, and Europe in order to concentrate more of its resources on a turnaround.

    The massive coffee chain from Seattle said that store closures will begin right away. Starbucks stated that severance compensation and, if feasible, transfers to other locations will be provided to the impacted baristas.

    The majority of the closures seem to be in the United States and Canada, though the firm did not specify how many stores are closing. Starbucks stated that by the end of its fiscal year, it anticipates having 18,300 outlets in North America.

    The corporation operated 18,734 sites as of June 29. Andrew Charles, an analyst at TD Cowen, predicted in a research note released on 25 September that Starbucks would eliminate about 500 locations in North America during its fiscal fourth quarter.

    Starbucks Stores in U.K., Austria and Switzerland to Close Soon

    Starbucks Chairman and CEO Brian Niccol announced in a letter to staff members in Europe that some of the company’s outlets in the United Kingdom, Austria, and Switzerland will also be closing. Additionally, Starbucks did not specify the number of locations that will be affected in those countries. According to Starbucks, non-retail staff members whose jobs are being cut will be notified.

    “A review of the company’s stores identified locations where the company doesn’t see a path to financial stability or isn’t able to create the physical environment customers expect,” Niccol wrote in a letter issued to employees. According to Niccol, the corporation opens and closes coffee shops annually for a number of reasons, including lease expirations and financial performance. The brand is aware that partners and customers would be impacted by this more important move.

    Starbucks coffee shops are community hubs, so shutting any of them is challenging. According to Starbucks, the restructure would cost $1 billion, which includes $150 million for employee separation benefits and $850 million for the liquidation of the physical store and lease termination costs.

    No Clarity on Number of Starbucks Stores to be Shut

    The number of unionised stores closing was not immediately apparent. Since 2021, employees at 650 Starbucks locations controlled by the firm have voted to become a union, but they have not yet been able to come to an agreement with the business. The labour organisation that organises employees, Starbucks Workers United, stated on 25 September that the closures were carried out without consulting Starbucks baristas.

    In order to guarantee that employees can be transferred to another store of their choosing, the union stated that it plans to negotiate at each union-represented store that is closing.

    Just over a week after unionised workers in three states sued Starbucks over its new dress code, claiming the business would not pay staff who had to purchase new attire, news of the store closures broke. Starbucks claimed that union presence did not play a role in the selection of the closing locations, which were made based on a consistent set of criteria.

    Quick Shots

    •900
    non-retail employees to be laid off as part of the turnaround plan.

    •Store
    closures to begin immediately, with transfers or severance offered where
    possible.

    •North
    America outlets expected to reduce from 18,734 to 18,300 by fiscal year-end;
    around 500 closures projected in Q4 FY26.

    •European
    closures in UK, Austria, and Switzerland announced; exact number of stores
    not specified.

  • Accenture Plans Major Restructuring: To Exit Businesses and Book Charges Amid Layoff Fears

    As it prepares for significantly slower growth in fiscal 2026, Accenture is laying off employees, selling off assets, and restructuring some aspects of its company. This highlights the growing burden on the global IT industry despite ongoing investments in cloud and artificial intelligence.

    CEO Julie Sweet stated on the company’s September 25 earnings call that the company is letting go of employees on a shortened schedule when retraining is not a practical option for the skills the company requires.

    Although she did not reveal how many people were laid off, Accenture’s employment decreased by about 7,000 employees in the fourth quarter of FY25, bringing its total headcount down to about 770,000.

    Accenture’s Business Optimisation Programme

    The company has started a business optimisation programme that consists of two parts: the divestment of two acquisitions that are no longer in line with its strategic aims and a rapid “talent rotation” that covers severance costs associated with accelerated workforce reductions.

    According to CFO Angie Park, Accenture anticipates charging roughly $250 million in Q1 FY26, or $865 million over six months, which will include both asset impairments and severance costs.

    She went on to say that these steps will save money, which will be used to support the company’s workforce and operations. The layoffs coincide with slowing growth and declining customer demand. “While there are still areas with high demand for AI, overall growth in our major markets is slowing down,” Sweet stated.

    Accenture’s Future Plans

    In local currency, Accenture now forecasts FY26 revenue growth of only 2–5%, down from 7% the previous year. A 1–1.5% drag from its U.S. federal business, which has been impacted by disruptions under Elon Musk’s new Department of Government Efficiency (DOGE), which has restructured IT procurement, is not included in the projection.

    Accenture stated that it will keep hiring and reskilling in priority areas in spite of the cuts and that staff growth in the US and Europe is still anticipated in FY26. Following the earnings release, investors’ reaction to the Nasdaq-listed company’s lowered growth estimate caused its shares to drop by roughly 2%.

    Its layoffs reflect difficulties in the industry as a whole; India’s largest IT company, Tata Consultancy Services, has already let go of over 12,000 workers this year, citing a lack of skills and waning demand.

    Quick
    Shots

    •Company to lay off employees, divest
    non-core businesses, and book charges for restructuring.

    •Workforce shrinks by 7,000 in Q4
    FY25, bringing total headcount to around 770,000.

    •Business optimisation plan includes
    divesting two acquisitions and accelerating “talent rotation.”

    •Accenture expects to book $250
    million in Q1 FY26 and $865 million over six months for asset impairments and
    severance.

    •Revenue growth forecast slashed to
    2–5% for FY26, down from 7% last year.