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TalkTalk shed hundreds of thousands of broadband customers last year, as the heavily indebted UK telecoms provider plans more job cuts to better compete with “altnets”.
The Salford-based group reported on Tuesday that its broadband customer base had fallen to 3.2mn as of February 2025, down from 3.6mn the year prior, in annual results seen by the Financial Times.
TalkTalk reported earnings before interest, taxes, depreciation and amortisation of £128mn in the year to February, down from £157mn in the previous year. Revenues fell 7 per cent to £1.4bn and the company guided that they would come in between £1.25bn and £1.35bn in the coming year.
TalkTalk has struggled since it was bought by Toscafund, a London-based hedge fund, in a £1.1bn leveraged buyout that added £527mn of debt on to its balance sheet in 2021.
The company’s shareholders — which also include Sir Charles Dunstone, TalkTalk’s executive chair — were last year forced to inject a further £235mn as part of a refinancing to help stabilise TalkTalk’s finances.
TalkTalk reduced its headcount by 350 staff last year — about 20 per cent of the total workforce — and said more jobs would be cut this year.
The company’s share of the UK broadband market has fallen to 11 per cent, down from 14 per cent in 2022, according to research by Enders Analysis.
In comparison, alternative providers, also known as “altnets”, comprise 7 per cent of the market, up from 3 per cent over the same period.
James Ratzer, analyst at New Street Research, said TalkTalk was in a “Catch-22 situation”.
“Ongoing customer losses remain a problem, but the financial situation remains very tight to fund the necessary investment to turn this around,” he said.
Karen Egan, head of telecoms at Enders, said altnets had pushed broadband prices to “uneconomic levels” in the UK.
“TalkTalk, in particular, has been at the sharp end of this pressure as both the altnets and TalkTalk appeal to the lower end of the market,” she added.
James Smith, who was appointed chief executive of TalkTalk Group in September, said the company was focused on winning profitable broadband business, retaining customers and strengthening its cash flow.
TalkTalk is also planning to refresh the product offering in its consumer business. Costs and capital expenditure will also be cut next year.
Additional reporting from Euan Healy in London.
