BT has unveiled plans to cut costs by an additional £700 million over the next four years, as the telecoms giant reported flat full-year earnings and a continued slide in revenues. The new target brings the group’s total cost-saving ambition to £3.7 billion, up from a previously stated £3 billion, and extends its restructuring programme by a year to the end of March 2030. The overhaul, first launched in May 2024, is now expected to cost £1.4 billion in total, compared with an earlier estimate of £1 billion.
Financial results signal persistent pressure
In the year to 31 March, BT posted underlying earnings unchanged at £8.23 billion, while underlying revenues fell 4% to £19.65 billion. UK service revenues declined 1% despite customer price increases. On a statutory basis, pre-tax profits rose 8% to £1.44 billion. Looking ahead, the company forecasts a further drop in revenues to between £19 billion and £19.5 billion for the current financial year, with earnings expected to edge slightly higher to between £8.2 billion and £8.3 billion. UK service revenues are predicted to come under additional pressure, with BT guiding a range of £15.1 billion to £15.4 billion for 2026-27, against the £15.4 billion reported in the past year.
Reasons behind falling revenues: competition and market shifts
The revenue decline reflects intensifying competition in both fixed-line broadband and mobile markets. BT’s wholesale arm, Openreach, has been hit by customer losses to low-priced rivals known as “retail altnets,” such as CityFibre, which have rolled out their own fibre networks. In the broadband sector, BT faces strong competition from Virgin Media O2 and Sky. In mobile, the merger of Vodafone and Three UK has created a larger, more formidable competitor. BT’s broadband market share stands at around 28.3% as of early 2025, serving roughly 8.2 million to 8.8 million customers, while through its EE brand it holds about a 30% share in mobile. Despite these headwinds, BT’s consumer division returned to customer growth across broadband, mobile and TV during the year.
Customer satisfaction has been mixed. A Which? survey from March 2015 placed BT at the bottom of its ISP rankings, but more recently the company reported record fibre build and connections, and an all-time high Net Promoter Score across the group, with best-ever scores in Consumer, BT SME and Global divisions. In February 2022, BT and EE brands won multiple awards, including ‘Broadband Provider of the Year’ and ‘Best Provider for Customer Service’ for EE.
Restructuring, job cuts and AI-driven efficiency
As part of its cost-cutting drive, BT has already delivered annual savings of £1.5 billion, including £580 million in the 12 months to 31 March. The workforce has shrunk by 7% over the past year to 108,000 staff. The company previously announced plans to cut up to 55,000 jobs worldwide by 2030 — more than 40% of its global employee base. Chief executive Allison Kirkby has indicated that artificial intelligence will play a role in replacing approximately 10,000 of those roles, particularly in customer service and network management, and that the growing adoption of AI could lead to even deeper job cuts beyond current plans.
BT is also actively divesting its international operations to refocus on its core UK market. It has agreed to sell its remaining Italian business to Retelit, including its B2B operations, fibre and data centre assets — marking BT’s exit from Italy, a process that has been ongoing since 2020 and follows a significant writedown in 2017 due to an accounting scandal. It has also completed the sale of its Irish wholesale and enterprise business unit to Speed Fibre Group for €22 million, excluding its multinational clients and the Emergency Call Answering Service. Reports in recent days suggest Kirkby is reviving plans for a possible stake sale in its struggling international business to refocus entirely on the domestic market.
Digital transformation and infrastructure investment
BT is heavily investing in its full-fibre broadband network, aiming to reach 30 million UK homes and businesses. As of April 2026, its full-fibre network already covers two-thirds of UK premises. Openreach, the group’s wholesale subsidiary, wholesales fixed access to more than 700 providers and its full fibre network reaches over 16 million premises by mid-2025. The company is also upgrading customers from analogue to digital voice services, with the Public Switched Telephone Network set to be retired by January 2027. BT’s 5G+ mobile network currently reaches 69% of the UK population and is planned to extend to 99% by spring 2030.
The company’s digital transformation strategy aims to shift from a traditional telecoms provider to a “techco,” leveraging artificial intelligence, 5G and the Internet of Things to enhance service delivery and create new business models. BT has also committed to becoming a net-zero business by March 2031.
Chief executive Allison Kirkby said: “We have delivered on our financial guidance and we are transforming ahead of plan, offsetting headwinds while successfully competing.”
