Telstra Corp. Ltd. (TLSYY.PK, TLS.AX, TLS) has announced plans to streamline its operations and reduce costs, with a goal of cutting up to 2,800 jobs by the end of this year.
The Australian telecommunications leader indicated that consultations for 377 of these roles would begin immediately, primarily in areas supporting products and services slated for exit from the Enterprise segment.
Telstra anticipates one-off restructuring costs ranging from A$200 million to A$250 million during the fiscal years 2024 and 2025. These costs will be excluded from their financial guidance and are additional to the business-as-usual annual restructuring expenses.
Reiterating its fiscal year 2024 guidance, Telstra provided fiscal year 2025 underlying EBITDA expectations between A$8.4 billion and A$8.7 billion.
The company reaffirmed its commitment to achieving its T25 CAGR goals for underlying EBITDA, earnings per share, and return on invested capital (ROIC) growth.
In its review of Telstra Enterprise, the company identified several actions, including a streamlined product portfolio that would reduce the number of NAS products in the market by almost two-thirds. They also plan to simplify the customer sales and service model for better support and reduce the cost base of the Telstra Purple tech services business, with a focus on NAS products.
Additionally, Telstra announced an update to the customer terms for its postpaid mobile plans, removing the CPI-linked annual price review.
In efforts to reset Telstra Enterprise, the company will also reshape some internal operations by integrating its Global Business Services function into other business areas.
Further, Telstra remains focused on reducing its non-labor and indirect labor costs.
Through these actions, Telstra aims to achieve A$350 million of its T25 cost reduction target by the end of fiscal year 2025.