TPG Telecom has cut 120 roles as it attempts to save around $20 million a year following a 40 per cent fall in its half-yearly profits.

The telecommunications giant — Australia’s third largest, and the parent of brands such as TPG, Vodafone, iiNet, and Internode — said on Friday that its restructuring would cost it between $7 million and $9 million.

While the company did not specify the divisions in which job losses had occurred, it said they took place "across the business".

CEO and Managing Director Iñaki Berroeta said the job cuts were the result of “taking action on operating costs” as the company sought to “offset the impact of sustained inflation of recent years”.

He also told The Australian that the cuts were “an order of magnitude less than we are seeing at our competitors”.

Telstra said it would sack around 2,800 workers by the end of 2024 as it tried to save more than $350 million, while Optus slashed nearly 200 jobs in its smart home installation division earlier this year.

TPG Telecom shares rose 8.3 per cent on Friday, as the company announced its half-year net profit had fallen 40 per cent to $29 million, compared with $48 million the same time last year.

It also declared an interim dividend of 9 cents per share, the same as its 2023 half-year dividend.

Profit slides amid higher costs

Executives from TPG Telecom had previously warned profits would slide due to ongoing investments in network infrastructure, higher financing costs, and higher interest rates on the company's loans.

The firm's half-year service revenue was up 1.7 per cent compared with the same period last year, with a 7.2 per cent increase in mobile revenue offsetting a 3.5 per cent drop in fixed service takings.

TPG Telecom said its mobile business had added 64,000 new customers, bringing it to a total of 5.52 million.

This included the addition of almost 100,000 subscribers through a new contract with mobile virtual network operator (MVNO) Lyca.

TPG Telecom also said its average revenue per mobile user was up 4.2 per cent to $34.40 per month, with postpaid customers now spending an average of $47.3 per month, up 6.1 per cent.

The company’s fixed internet connection customer base declined by 30,000 in the first half of the year to 2.1 million, while its wireless services grew by 18,000 to 245,000 subscribers.


TPG Telecom's half-year results saw a rise in mobile revenue, but a drop in takings from fixed line services. Photo: Shutterstock

Date set for findings of TPG-Optus deal

Berroeta added that TPG Telecom was working towards securing regulatory approval for its proposed regional network sharing deal with Optus.

The deal would see TPG Telecom pay Optus approximately $1.59 billion over 11 years to share its regional telecommunications network.

The Australia Competition and Consumer Commission (ACCC) has set 13 September as a provisional date to announce the findings of its review into the proposed arrangement.

The ACCC blocked a similar deal between TPG Telecom and Telstra in 2022, arguing it would hurt competition and leave regional Australians “worse off”.

Berroeta said TPG Telecom continued to work towards streamlining its business as customers’ needs changed.

“The simplification of our business and removal of complexity and duplication will directly benefit customers from early next year, as we deliver a step-change in redesigned products, services and improved processes,” he said.

TPG Telecom shut down its 3G network between December 2023 and January 2024.

Telstra and Optus have scheduled to shut their 3G networks in October, after concerns over consumer preparedness led the date to be pushed back twice.