British American Tobacco's AI Overhaul: Cost Cuts and Strategic Shifts

British American Tobacco is set to cut 20% of its workforce as part of an AI-driven overhaul aimed at cutting ‌costs and increasing profits. This restructuring will impact around 9,000 employees and is expected to offer significant annual savings by 2028. The strategy includes a shift towards smoking alternatives.

British American Tobacco (BAT) is planning a significant restructuring as it cuts around 20% of its workforce. Announced on Monday, the company aims to reduce costs and increase profits through an AI-driven overhaul amid regulatory challenges.

The company anticipates £600 million in additional annualized savings by 2028, with immediate cuts affecting about 5,500 jobs and moving roughly 3,500 roles to third-party firms, impacting around 9,000 employees in total. The restructuring notably excludes the U.S., BAT's largest market.

BAT's strategy also includes a shift toward smoking alternatives amidst regulatory hurdles and an influx of illegal imports impacting sales and market share. The firm faces challenges from high living costs, rising duties, and tighter regulations in key markets.