Verizon CEO Vestberg says that Verizon will continue to cut its workforce
Supino might have asked Vestberg about Verizon‘s hiring plans because of a slight increase in the headcount last quarter sequentially. But Vestberg’s response was to indicate that Verizon is still in cost-cutting mode; even though the carrier’s workforce rose from 99,400 at the end of March to 100,000 at the end of June, the headcount year-over-year was still 3.7% lower.
Analysts like Supino love to see the companies they follow cut the workforce since it quickly lower costs. One of the reasons not to expect Verizon to go on a hiring binge is the use of AI. Verizon has just started to bring AI into its workforce with the carrier telling the SEC in its last annual report that “We are using AI in our network deployment and maintenance as well as our customer and employee support services.”
Verizon CFO Tony Skiadas said, “We continue to take cost out, whether it’s AI, whether it’s network. Whether it’s IT platform consolidation or real estate, we’re continuing to push cost out of the business.” Current Verizon employees might be very worried about how hard the carrier is going to push.
That Verizon is more efficient now cannot be denied. In 2012, a year we discussed earlier in this article, Verizon took in $631,000 in revenue per employee. This has risen to $1.35 million in revenue generated by each Verizon employee. While many believe that AI is bringing these efficiencies to the nation’s largest wireless carrier, Verizon disagrees. Verizon says that there are too many risks involved in using AI to replace human employees.
The big question that Verizon will need to answer in the face of more cuts to its workforce
In its latest annual report filed with the SEC, Verizon said that, “There are technological, regulatory, ethical and other risks involved in deploying and using AI, particularly generative AI models. There can be no assurance that the usage of AI will meaningfully enhance our products or services or be beneficial to our business, including our efficiency or profitability.”
