Vodafone to axe 11,000 jobs 

Its new chief executive Margherita Della Valle announced her plans to "simplify" operations at the British telecoms giant, saying its "performance has not been good enough".

The company, which employs around 90,000 staff globally, reported a drop of 1.3% in full-year earnings to €45.7bn (£39.7bn) and a fall in pre-tax profits, which the company attributes to higher energy costs, and commercial underperformance in Germany.

Della Valle, who is also serving as its interim finance director until a replacement is found, said the company needed to be leaner to compete with rivals like o2, Three mobile and EE.

“Today I am announcing my plans for Vodafone. Our performance has not been good enough. To consistently deliver,Vodafone must change.

"My priorities are customers, simplicity and growth. We will simplify our organisation, cutting out complexity to regain our competitiveness. We will reallocate resources to deliver the quality service our customers expect and drive further growth from the unique position of Vodafone Business."

Vodafone employs about 9,000 people in the UK, including at its headquarters in Berkshire. It is not known how many UK staff will be affected by the cuts.

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The company saw a decline of 1.1% in service revenue in its European Consumer operations, which account for 51% of group service revenue.

Its largest market, Germany, saw weak sales, which Della Valle put down to the timing of payments for cable TV in Germany due to a change in the law. 

Matt Britzman, equity analyst at Hargreaves Lansdown, said: "Part of that can be tied to falling customer satisfaction levels in those regions."

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The job losses, which equate to around 12% of its global workforce, will fall across Vodafone’s entire operations.

The company hope the strategy will “maximize the potential” of Vodafone Business, as well as putting greater emphasis on customer service by delivering a “simple and predictable experience”.

Britzman said: "New CEO, Margherita Della Valle, has been very vocal about the host of challenges she’s facing in her new role – the honesty is refreshing but not enough to keep shares from falling on the news. 

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"Today, Vodafone outlined some of its new strategies to combat poor performance, which include cutting around 11,000 jobs over the next three years, streamlining operations and focusing on Vodafone Business.

"This makes sense on paper, but markets will need to see tangible results over the coming year before they get more excited.”

Vodafone’s share price dropped nearly 4% on Tuesday.