Verizon Cuts 13,000 Jobs in Massive “AI-First” Shakeup

NEW YORK — Verizon (NYSE: VZ) is cutting more than 13,000 jobs in its largest layoff ever. The cuts will hit about 13% of the company’s total workforce. New CEO Dan Schulman announced the plan in a memo to staff this week, stating the company must fix its costs to compete in a market focused on artificial intelligence and digital tools. The news was first reported by Reuters.

Key Facts

• Management Hit Hard: The cuts affect roughly 20% of all non-union management roles.
• Retail Changes: Verizon is turning 179 company-owned stores into franchise locations, moving those workers off the direct payroll.
• The Cost: The company expects to spend up to $1.8 billion on severance payments this quarter.
• Source: Reuters, TeckNexus

Why This Is Happening

Verizon is dealing with two big problems: slow growth in new phone customers and the high cost of buying Frontier Communications for $20 billion. CEO Dan Schulman, who took over in October, said the company’s current expenses are too high. This prevents them from investing in new plans to help customers.

Instead of “optimizing” or “streamlining,” Schulman was blunt: the company needs to simplify. By cutting layers of management and using more automation, Verizon hopes to speed up how it works. This is part of a pivot to become an “AI-first” company. While they say AI is not directly replacing these 13,000 people today, the company is clearly moving toward a model that needs fewer humans to run the network.

The Severance Package

Workers losing their jobs will get support, but the terms are strict. According to documents shared by employees, the severance package includes:

• Two weeks of base pay for every year of service.
• A payout for any unused vacation days.
• Full payment of yearly bonuses (no cuts to the bonus check).

Verizon has also set up a $20 million fund to help fired workers learn new digital skills. This is meant to help them find jobs in a tech-focused market.