Telefonica plans to lay off 6,000 workers this year, Expansion reports

Telefonica is reportedly planning to lay off at least 6,000, and potentially up to 7,000, employees across its Spanish units, including Telefonica Moviles and Telefonica Soluciones, according to Expansion. While a company spokesperson denies current redundancy program plans, they confirm ongoing internal analyses, with an official announcement possibly following the new strategic plan presentation on November 4 to finalize by year-end for 2025 financial provisions. This significant workforce reduction, potentially affecting 6-7% of its global staff, signals a strategic cost-cutting and efficiency drive as the company prepares for its new direction, extending to previously unaffected corporate centers.

Analysis

MADRID, Oct 6 (Reuters) - Spanish telecoms group Telefonica (TEF.MC) plans to lay off at least 6,000 employees across several units before the end of the year, newspaper Expansion reported on Monday, citing people familiar with the plans. The total number of workers initially affected by the redundancy plan could rise to 7,000 out of a global workforce of around 100,000, the report added, although negotiations with unions tend to reduce such targets. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. Advertisement · Scroll to continue A spokesperson for Telefonica told Reuters that "multiple analyses are being carried out in all areas of the company, but there are no plans for a redundancy programme at this time". The company is set to present its new strategic plan spearheaded by recently-appointed Executive Chair Marc Murtra on November 4. According to the Expansion report, Telefonica seeks to officially inform unions of the potential layoffs shortly after the strategic plan's presentation, which could allow the company to reach a deal before December 31 and thus allocate the resulting provisions to the 2025 financial year. Advertisement · Scroll to continue The redundancy plan is expected to be similar to one implemented in 2024, which was "preferably voluntary" for employees aged 55 and over, Expansion added in its report. According to the report, the bulk of affected employees - up to 5,000 - will likely belong to the Spanish business, as well as subsidiaries Telefonica Moviles - the company's mobile and broadband unit in Spain - and Telefonica Soluciones, which offers outsourced IT services. However, employees at the corporate centre - which until now had been spared from previous redundancy plans - may also be affected. Reporting by David Latona; Editing by Emelia Sithole-Matarise Our Standards: The Thomson Reuters Trust Principles. Telefonica (TEF.MC) is reportedly planning a significant workforce reduction of 6,000 to 7,000 employees, representing up to 7% of its global staff, with a primary focus on its Spanish operations. While the company has officially denied a current redundancy program, it confirmed that internal analyses are underway, lending credibility to the reports. The timing of this potential action is strategically significant, as it is expected to be announced following the presentation of a new strategic plan on November 4. By aiming to finalize an agreement by year-end, Telefonica could book the associated restructuring provisions in the 2025 financial year, suggesting a forward-looking move to align its cost base with its new corporate direction under Executive Chair Marc Murtra. The inclusion of the corporate center, previously untouched by layoffs, indicates a deeper and more comprehensive approach to this restructuring effort, which is aimed at driving efficiency and cutting operational expenses ahead of the company's next strategic phase.

Key Decisions for Investors

• Investors should closely scrutinize Telefonica's strategic plan presentation on November 4, as details on the restructuring's full scope and accompanying growth initiatives will be critical to assessing the long-term value proposition.
• Consider modeling the financial impact of the potential layoffs, weighing the near-term restructuring charges against the long-term operational expense savings to evaluate the potential for margin expansion.
• Given the company's official denial versus the detailed media report, it is prudent to monitor for an official company announcement to confirm the scale and terms of any redundancy plan before adjusting positions, as headline risk and volatility may persist in the near term.