UK telecoms company Virgin Media O2 has confirmed that it will axe thousands of jobs over the coming years, as part of an £800 million ($1.07 billion) cost-cutting drive.

Virgin Media O2 confirmed the cuts today as it looks to ease investor concerns over a £22bn ($29.5bn) debt pile.

Outlining its cost-saving strategy, Virgin Media O2 said its new strategic plan "will set the direction for future growth and commercial momentum across all areas of the business."

As part of the strategy, the company said it expects to deliver cost savings of £800m ($1.07bn) by 2029, with around £400m ($500m) delivered in 2027.

The telco said that approximately £300m ($402m) of the 2029 run-rate saving is expected to come from a reduction in the size of the workforce, which equates to roughly 30 percent of the company’s total people costs over the next two years. At present, the company has around 16,000 employees.

Confirmation of the cuts comes after earlier reports that the telco was planning to cut up to 4,000 jobs. Virgin Media O2 confirmed the majority of the cuts will come from non-customer-facing roles.

The telco said it will provide details of its full strategic plan around the time of the company’s full year results, which it said will set a new direction for VMO2’s consumer brands and propositions, including the simplification of its B2B portfolio.

Virgin Media O2 noted that the company will continue to invest in its mobile network, through the expansion of its 5G Standalone (5G+) service, plus O2 Satellite.

However, the company did add it's halting investment in further fiber upgrades beyond its existing commitments to partners. It had been reported last week that the company was nearing an agreement to use rival BT's network in areas not covered by its existing network.

“The direction we’re setting today paves the way for the next chapter of Virgin Media O2: a company that will be leaner, clearer on priorities and faster in delivery, with brilliant brands and an unwavering focus to get back to what really makes a difference to our customers," said Lutz Schüler, CEO of Virgin Media O2.

"Given the market conditions we face, the regulatory backdrop in fiber and the technological changes sweeping across all areas of the economy, standing still and doing what we’ve always done is not an option, and while many of these decisions are tough, they are necessary for our future success and growth."

So far this year, VMO2 said it's invested more than £1.5bn invested on its mobile network and fiber buildout. The company adds that its 5G+ coverage covers 86 percent of the UK's population, while its full fiber footprint has surpassed 9.4 million locations.

Not the only telco cutting jobs

The telco has previously shed jobs in the years after its merger was completed, with around 2,000 roles cut in 2023, while earlier this year it was reported that up to 300 jobs in the UK were being lost.

But VMO2 is far from the only UK telecoms company to cut jobs or consider further cuts. The company's biggest rival and the UK's largest telco, BT, is working towards its goal to cut 55,000 roles by the end of the decade.

Another competitor in the broadband arena, Sky, previously cut hundreds of jobs last year, while TalkTalk, set to be snapped up by BT, has also cut jobs in recent years.