Vodacom Announces Job Cuts Across All Levels in South Africa
Vodacom, South Africa’s leading mobile network operator, has revealed plans to cut 80 jobs across all levels of its workforce to streamline operations and reduce costs.
This announcement comes amidst efforts to adapt to evolving market dynamics and transition towards becoming a prominent technology company.
The decision to downsize has led to a 2% decline in Vodacom’s stock price following the news of the impending retrenchments. With a current workforce of 5,400 employees, the reduction aims to optimize operational efficiency while maintaining financial resilience, according to a spokesperson for the company.
Vodacom’s latest financial report, released in September 2023, indicated significant revenue and operating income growth of 35% and 32%, respectively. However, the company experienced a downturn in profit margin and cash reserves, with a 20% decrease in profit margin and a substantial 57% decline in cash on hand.
Vodacom attributed these challenges partly to investments in alternative power sources to mitigate the effects of load-shedding.
The telecom giant’s upcoming financial results for the fiscal year ending March 31st, 2024, are eagerly anticipated, with stakeholders keen to assess the impact of recent developments on the company’s performance.
Beyond financial considerations, Vodacom faces additional challenges, including a prolonged legal dispute with a former employee regarding compensation for the invention of the “Please Call Me” service.
A court ruling determined that the ex-employee is entitled to a percentage of revenue generated from the service, potentially amounting to R63 billion, equivalent to approximately 10% of Vodacom’s market capitalization.
Additional source: Techcabal
