AT&T and Verizon Cut 8,000 Jobs in a Quarter as Layoffs Become Routine

AT&T and Verizon shed a combined 8,000 jobs in a single quarter, roughly 4% of their combined workforce, according to third-quarter filings published this week. Verizon ended September with 93,300 employees, down from 97,600 in June. AT&T, reporting a day earlier, disclosed 3,700 job cuts over the same three months.

Together, the two operators employed about 228,500 people in June — fewer than AT&T alone had in 2020. Headcount across both companies has dropped by 142,460 since then. AT&T has cut its workforce by 28% over five years; Verizon's is down 17%. Few would have predicted in 2020 that AT&T would cut 45% of its staff in six years.

Is AI really to blame?

Verizon CEO Dan Schulman wants you to think about the future, not the spreadsheets. "I think as I look out over the next couple of years, there'll be something like 8.5 billion people in the world, but I think there could be at least 100 billion agents," he told analysts on the third-quarter results call. He promised Verizon would bar agents from its platforms unless "we're 100% certain that it's truly a customer and not a rogue agent."

Schulman has form with dramatic AI forecasts. Speaking to The Wall Street Journal in April, he reckoned AI could push US unemployment to 30% within two to five years. The Bureau of Labor Statistics shows the rate stuck at 4.2% between April and September. His AI prophecy currently looks about as reliable as McKinsey's 2022 claim that network APIs would generate up to $300 billion in extra telco sales over five to seven years — a forecast that will miss by a country mile unless usage spikes unprecedentedly before late 2029.

What's actually driving the cuts?

The evidence against the AI narrative is fairly blunt. Both telcos were cutting jobs long before ChatGPT went public on November 30, 2022, and the deepest reductions predate it. Nor are the operators visibly more profitable. Verizon booked total operating expenses of about $25.7 billion for the recent third quarter, up slightly from $24 billion five years ago. AT&T's equivalent figure was flat at $28.2 billion.

The more mundane causes read like a mid-2000s restructuring memo:

• Standard efficiency programs and thinner layers of middle management
• Heavier reliance on external contractors
• Retreat from non-core businesses such as TV
• Duplicate roles removed after mergers
• Store closures as customers shift to online channels

Savings, where they exist, have been eroded by wage inflation, severance packages and outsourcing costs. Labor typically accounts for only about a fifth of a large US telco's total costs.

Can the cuts continue?

Investors might reasonably cheer the arithmetic. Verizon grew annual sales by almost $10 billion between 2020 and 2025 while shedding about a third of its workforce. Revenue per employee rose from about $970,500 in 2020 to more than $1.53 million last year. No analyst, notably, thought to ask about that on the results call. Layoffs used to signal trouble; now they barely merit a mention.

Verizon's own numbers tell a story of acquisition and attrition. It finished 2025 with 9,700 fewer employees after Schulman announced 13,000 cuts on his arrival as CEO. The Frontier Communications acquisition, a broadband operator with about 13,000 staff, arrived at the start of 2026 — yet headcount still fell from roughly 112,600 pro forma at end-2024 to 93,300 by September.

Is the software side safe?

The software organization looks most exposed to agentic AI, given how sharply code-writing tools improved this year. But IT bosses inside telcos still treat tools like GitHub Copilot as an accelerator for human coders, not a replacement. Handing expertise to systems few people fully understand risks leaving operators dependent on expensive, fallible technology — and if humans stop being trained, the skills may simply vanish.

Schulman, for his part, expects agents to drive "an explosion in data traffic," making the Verizon network "a scarce and valuable asset. And we will price it as such. You'll see different pricing plans." The market's verdict was unimpressed: Verizon's share price fell 3% on results day and is down more than twice that over the past month on Starlink concerns. Analysts are skeptical of the AI productivity story — and even less convinced by the sales one. If the current pace holds, AT&T would enter 2032 and the 6G rollout with around 70,000 employees.