British American Tobacco cuts 5,500 jobs in AI-driven cost push

British American Tobacco will cut 5,500 jobs globally as it pushes ahead with an AI-driven transformation programme, the company said Monday.

"We are building a future-ready organisation that is more agile, cost disciplined and technology enabled," Chief Executive Tadeu Marroco said. "Fit2Win is central to this ambition, strengthening how we operate and our ability to compete in a rapidly evolving environment."

The Fit2Win programme is expected to reduce costs by £600m by the end of 2028 through streamlining operations and building closer partnerships with technology and business services companies. BAT has partnered with Accenture to gain access to advanced AI solutions. An additional 3,500 roles have been moved to strategic partners.

The job cuts signal a major structural shift at one of the world's largest tobacco companies as it seeks to offset declining cigarette volumes with cost efficiency and digital transformation. The restructuring affects many of our colleagues, Marroco said, adding that the company is focused on supporting them through the transition.

The cuts represent roughly 5 percent of BAT's global workforce, based on the company's most recent headcount of about 100,000 employees. The London-based company employs staff across more than 180 countries.

The restructuring comes as tobacco companies face declining smoking rates in developed markets and increasing regulatory scrutiny. BAT has been investing in reduced-risk products such as vaping and heated tobacco to diversify its revenue base, though the Fit2Win programme signals a parallel focus on operational efficiency.

The cost savings target of £600m by 2028 implies annualized savings of roughly £150m once fully implemented, based on the programme's timeline. BAT did not disclose whether further restructuring charges would be recorded in its upcoming financial statements.

This article is for informational purposes only and does not constitute investment advice.