Telus announces 6,000 layoffs and 61% net income decline for Q2

Telus Corp. is cutting 6,000 jobs, the company announced Friday. Telus International will see 2,000 losses while its main business will cut the remaining 4,000 positions. The company says it is offering packages for early retirement and voluntary departure. The news dropped on the same day the Vancouver-based company released its second quarter results. The company is expected to save $325 million with the cuts. Telus president and CEO Darren Entwistle said the company is trying to get ahead of regulatory challenges to come and to “prepare to better absorb any regulatory impediments.” “They are preemptive in terms of how we see certain regulatory challenges evolving in the months and years ahead,” he said. Donna Hokiro, president of USW Local 1944, which represents 7,000 workers from Rogers Communications Inc. (and Shaw) and Telus, said the company has been “deceptive.” “Telus has been eroding good Canadian jobs at a dramatic rate for the last decade, with no end in sight. Corporate executives have been more concerned about their reputation than the truth or their responsibility to Canadian consumers,” Hokiro said in a press release. According to the union, Telus rebutted claims that it was cutting jobs, insisting that it was instead cost saving through voluntary severance packages. The union also said that the incumbent threatened litigation after USW sponsored a series of ads during collective bargaining “highlighting Telus’ historic and ongoing job cuts, contrasted by the exorbitant executive compensation of the CEO.” The union called on the federal government to suspend all current and future contracts with Telus unless it stipulates that the telecom will maintain domestic jobs. “Telus has benefited from procurement contracts worth billions of dollars with the federal government and provincial governments in British Columbia, Ontario and Quebec among other jurisdictions, with governments never once tying contracts to continued local jobs,” said Warren. “This has been deeply irresponsible and we are seeing the fall-out from that today,” said USW national director Marty Warren. NDP leader Jagmeet Singh called out Entwistle for laying employees off while he racked in $17.49 million in pay last year. Singh blamed the Liberals for the layoffs, claiming they “are taking every chance they get to give these companies a free ride.” “They didn’t intervene to stop the Rogers Shaw merger and now there’s even less competition for Canadian consumers and opportunities for workers. When the merger was proposed, New Democrats opposed it because we were worried costs would go up and jobs would be lost. Clearly, we’re seeing huge layoffs and it’s not just at Telus. BCE Inc. also announced it was laying off 1,300 employees, closing six radio stations and selling three, in June. In its second quarter results, released Thursday, Bell posted a 40 per cent decline in profit from $654 million last year to $397 million this quarter. Although revenue increased by 3.5 per cent to $6.1 billion. The shortfall was attributed to “higher interest expense, higher severance, acquisition and other costs related mainly to a workforce reduction initiative, increased depreciation and amortization expense and higher income taxes,” according to the company's quarterly report. More cost restructuring might be underway should the current regulatory environment persist. “We in our industry continue to be greatly impacted by a number of challenges, including operating losses across our news divisions, a prolonged advertising slump with no signs of immediate recovery, the shift of advertising revenue to foreign digital platforms, content cost, inflation and more challenging regulatory environment,” Bibic said in a call with analysts. Telus also posted a large decline in profits this quarter. For the three months ending June 30, Telus’ net income decreased by almost 61 per cent from the same period last year to $196 million. Broadband expansion, higher interest rates, and other factors contributed to the decline. Revenues totalled $4.9 billion which represents a 12 per cent increase from last year. Average revenue per user (ARPU) increased by $1.06, to $58.80 in the quarter. Bell’s ARPU remained flat at $59.16. Bell reported 125,539 net mobile subscribers, a 13 per cent increase from last year. Telus reported 110,000 net mobile additions this quarter, an increase of 18 per cent from Q2 2022. –Reporting by Jenna Cocullo at jcocullo@thewirereport.ca and editing by Paul Park at ppark@thewirereport.ca

Telus announces 6,000 layoffs and 61% net income decline for Q2

News | August 4, 2023

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Telus announces 6,000 layoffs and 61% net income decline for Q2

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