BT is to lay off 10,000 workers as it tries to counter a margin squeeze as the world lurches into recession.
A BT spokesman said 4,000 of the planned lay-offs have already taken place through voluntary redundancies and normal attrition. Another 6,000 will go in the next six months from all sectors of the business, he said. "It's everyone from IT consultants to call centre workers in the UK and India."
The UK's biggest telco reported a 4% growth in sales to £5.30bn, but earnings before interest, tax, depreciation and amortisation dropped one percent to £1.43bn. This was due mainly to lower profits from the Global Services division, which grew 15% in the quarter, signing new business worth £1.8bn.
BT CEO Ian Livingston said, "Demand for our BT Global Services' proposition remains strong. What we have to do now is translate revenue growth into better profitability."
BT's underlying businesses were generally strong but showed evidence of increased competition and tightening margins. Managed solutions revenue, including MPLS and networked IT services, increased 23% to £1.52bn, and broadband and convergence revenue increased 2% to £649m.
This was partially offset by an 8% decline in revenue from calls and lines to £1.6bn, and a 4% drop in revenue from transit, conveyance, interconnect circuits, WLR, global carrier and other wholesale products to £822 million.