Verizon’s plan to slash thousands of jobs as part of a drastic cost cutting program hit the official books last week, with details showing swift action and a big price tag.

Verizon in a Securities and Exchange Commission (SEC) filing noted that it will slash more than 13,000 employees from its payroll, with more than 80 percent of those employees “exiting the business in December 2025.” The carrier added that it expects to take a severance charge of up to $1.8 billion during the current fourth quarter tied to the cuts.

Verizon’s filing also noted that the carrier “expects that its cost reduction efforts will include a significant reduction in outsourced, contracted, and other outside labor expense.”

The cuts, which were initially reported by The Wall Street Journal earlier this month, are the quick work of recently installed CEO Dan Schulman, who replaced long-time CEO Hans Vestberg in early October. Schulman served on Verizon’s board and had previously headed up PayPal and former mobile virtual network operator (MVNO) Virgin Mobile USA.

Quick action

Schulman last week named former PayPal colleague Alfonso Villanueva to head up the carrier’s operational transformation as EVP and chief transformation officer. Villanueva officially started in that position on November 20, which is also the date of the latest SEC filing.

“He helped shape PayPal’s strategic roadmap, led its M&A activities, expanded its data and analytics capabilities, and oversaw venture investments,” Schulman noted in a “letter” tied to the hiring. “Alfonso also led the office of the CEO, driving key initiatives that accelerated the company’s growth and transformation. He is a strong leader with deep expertise and an extraordinary colleague.”

Schulman pointed to “AI, automation, and digital acceleration” as key tenets for Verizon’s planned turnaround, reiterating comments made during the carrier’s most recent earnings call. That focus will run through Villanueva, who will head “key functions … on developing our digital infrastructure and expanding the capabilities we need to delight customers and lead the industry.”

“Our new Transformation Organization will be responsible for driving the change we need to execute against our strategic priorities, and scaling the innovation, technologies, and investments that will define the next chapter of Verizon’s growth,” Schulman wrote, further adding that, “Alfonso and his team will help us see beyond where we are today and build the next wave of opportunities into lasting competitive advantage. This is about taking bold action – transforming our company to focus on creating value for our customers and shareholders, maximizing the impact of our resources and capabilities, and leading our industry forward.”

Schulman’s mandate

Schulman had previously stated that Verizon was “at a critical juncture,” but that it had a “clear opportunity to redefine our trajectory, by growing our market share across all segments of the market, while delivering meaningful growth in our key financial metrics. We are going to maximize our value propositions, reduce our cost to serve, and optimize our capital allocation to delight our customers, and deliver sustainable long-term growth for our shareholders."

Schulman later provided a few clues to those plans as he presided over his first earnings call as CEO.

“We are going to take bold and fiscally responsible action to redefine Verizon’s trajectory at this critical inflection point for our company,” Schulman noted in a statement tied to the earnings release. “We will rapidly shift to a customer-first culture, one that thrives on delighting our customers. These will not be incremental changes. We will aggressively transform our culture, our cost structure, and the financial profile of Verizon in order to put our customers first, compete effectively, and deliver sustainable returns for our shareholders.”

Schulman added that this included a bigger focus on using AI to power his plans in overhauling Verizon’s operations.

“We have barely scratched the surface of how AI-powered innovation can transform our customer experience,” Schulman said during his prepared remarks. “I intend to use AI as a key tool simplify offers, improve the customer experience, and reduce churn through smart, consistent, and more personalized marketing and offers, and we will leverage AI throughout the company to make it easier for our employees to delight our customers and to dramatically improve service while reducing costs.”

However, Schulman’s AI enthusiasm was quickly countered by his stating that there would also be parts of the Verizon business that could be cut.

“We have parts of our business that are costing us billions of dollars of margin and I think we can think much more clearly about how do we invest in growth areas and divest or exit those that are not that for us and are actually hemorrhaging margins for us,” Schulman said, before adding ominously, “you can probably imagine what we're thinking about and talking about on that.”