Canadian telecommunications giant BCE announced plans to reduce its workforce by nearly one-tenth in an effort to cut costs. This decision comes after reporting a decline in profit and in-line revenue growth in the fourth quarter.
BCE reported a decline in net income to 435 million Canadian dollars ($323.1 million), or C$0.42 a share, down from C$567 million, or C$0.58 a share, in the comparable quarter a year ago. However, adjusted earnings rose to C$0.76 a share, surpassing analyst expectations of C$0.73.
BCE plans to reduce its workforce by about 4,800 positions, which accounts for 9% of all its employees by 2024. By doing so, the company aims to achieve cost savings between C$150 million and C$200 million in the short term and C$250 million annually thereafter.
Capital Expenditure Reduction
In addition to the workforce reduction, BCE is also implementing a plan to lower its capital expenditure. It aims to reduce capital expenditure by more than C$1 billion in 2024 and 2025, with a minimum of C$500 million this year.
Adapting to Government Policies
In response to government and regulator policies, BCE will roll back its fiber network expansion and cap its speeds. This move is part of the company’s efforts to align its cost structure with the revenue potential of each business segment.
Overall, BCE is taking decisive actions to position itself for future success by aligning costs with revenue potential and implementing significant cost-cutting measures, including the largest workforce restructuring initiative in nearly 30 years.