{"id":47484,"date":"2026-11-03T07:45:38","date_gmt":"2026-11-03T07:45:38","guid":{"rendered":"https:\/\/www.ispreview.co.uk\/?p=47484"},"modified":"2026-11-03T08:23:55","modified_gmt":"2026-11-03T08:23:55","slug":"virgin-media-o2s-uk-broadband-customers-fall-as-cost-cutting-strikes-and-fttp-upgrades-stop","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2026\/11\/virgin-media-o2s-uk-broadband-customers-fall-as-cost-cutting-strikes-and-fttp-upgrades-stop.html","title":{"rendered":"Virgin Media O2’s UK broadband customers fall as cost cutting hits and FTTP upgrades stop"},"content":{"rendered":"

The latest Q3 2026 results from broadband and mobile operator Virgin Media<\/a> and O2<\/a> (VMO2) have today been released, which reports a fall in consumer broadband customers of -22,100 to total 5,395,800 (vs -28,200k in Q2) and another decline in their mobile base to total 46.348m (down from 46.428m). But the big story this time is one of cost cutting, job losses and a stalled fibre upgrade scheme.<\/p>\n

We’ll start with the usual recap. The results confirm that Virgin Media<\/a> and nexfibre<\/a>\u2019s combined UK broadband network reaches a total of 18,814,000 Homes Serviceable<\/strong> (mostly flat from 18,811,600 in Q2). The results also reveal that a total of 9.4 million Virgin Media<\/a> and nexfibre<\/a> premises (footprint) are now covered by full fibre (FTTP<\/a>) lines \u2013 using XGS-PON and RFOG technology, which is up from 9m in Q2 (nexfibre<\/a> alone account for 2.6m – most of the increase has thus come from Virgin’s own coax to FTTP<\/a> upgrades).<\/p>\n

NOTE:<\/strong> Virgin Media and giffgaff<\/a> are currently the only major retail ISPs on nexfibre\u2019s open access full fibre network and both share some of the same parentage.<\/div>\n

However, it\u2019s important to highlight how VMO2\u2019s figures for broadband customers no longer include their fixed business base, so we\u2019re now only able to count their consumer base in the total. On the financial front, VMO2 reported total revenue of \u00a32,426.7m in Q3 2026, which is up from \u00a32,398.9m last quarter.<\/p>\n

In addition, it’s worth noting that the outdoor population coverage of O2<\/a>’s latest 5G<\/a>+ (5G<\/a> Standalone) mobile (mobile broadband) network remains unchanged at 86%.<\/p>\n

VMO2 Q3 2026 UK Customer (Connection) Figures<\/strong><\/span>
\n5,395,800 Consumer Broadband \u2013 (down from 5,417,900 in Q2)
\n46,348,800 Mobile inc. Wholesale \u2013 (down from 46,428,700)<\/p><\/blockquote>\n

At the same time, it can’t have escaped the notice of our readers that VMO2 have been having a bit of a rough and unusual quarter. Recent news reports have warned of a c.\u00a3600m cost cutting<\/a> drive to help manage the company’s debt pile and falling bond prices, which is expected to result in upwards of 4,000 jobs being cut<\/a>.<\/p>\n

None of the above has been helped by the CMA’s provisional rejection<\/a> of nexfibre’s \u00a32bn deal for Netomnia<\/a>, which has created somewhat of a chaotic situation in the market for alternative networks (i.e. uncertainty over future consolidation options) and may risk removing a useful source of fresh investment for VMO2\/nexfibre.<\/p>\n

Further reports have since claimed that Virgin Media are set to halt<\/a> both the planned upgrade of their existing Hybrid Fibre Coax<\/strong> (HFC \/ DOCSIS<\/a> 3.1) network to full fibre and future deployments of FTTP<\/a> infrastructure into new areas. The same report indicated that VMO2 were close to reaching a deal to harness Openreach<\/a>’s network for FTTP in the parts of the UK where their existing network doesn’t yet reach.<\/p>\n

What the Q3 2026 results confirm<\/strong><\/span><\/h3>\n

Suffice to say that all eyes were on today’s Q3 results to see what they might contain. The group broadly confirms a new strategic plan and related cost reduction measures, which aims to “create a simpler company with prioritised investment to improve customer experience, commercial performance and cash generation with a commitment to reducing leverage<\/em>.”<\/p>\n

The company expects to deliver cost savings at an annual run-rate of approximately \u00a3800 million by 2029<\/strong>, with around \u00a3400 million delivered in 2027. Approximately \u00a3300 million of the 2029 run-rate saving is expected to come from a reduction in the size of the workforce<\/strong>, which equates to roughly 30% of the company\u2019s total people costs over the next two years, with the majority of the reduction coming from non-customer facing roles.<\/p>\n

Virgin Media also confirmed that they will “halt investment in further fibre upgrades<\/em>” beyond its existing commitments to partners. The operator states that market economics do not support three overlapping fibre networks, and they believe the company\u2019s HFC (coax cable) network will “continue to deliver market-leading broadband at scale, with a low-cost upgrade being deployed to bring 2Gbps services to the majority of the network in 2027<\/em>“.<\/p>\n

However, the operator adds that “where any future fibre investment makes strategic sense, it will be supported off-balance sheet and only in non-altnet areas<\/em>“. Finally, Virgin Media confirmed they were also exploring wholesale arrangements to support the expansion of its services to off-net areas not covered by Virgin Media O2<\/a> or nexfibre\u2019s networks, albeit without naming Openreach<\/a>.<\/p>\n

Key Points of the new Strategic Plan<\/strong><\/span><\/p>\n

\u27a4 In consumer<\/strong>, this will mean creating a more clearly defined role in the market for each of the company\u2019s brands, each headed by a dedicated commercial leader driving better execution; simplifying the current product and proposition line up; addressing core customer pain points; and better rewarding loyalty to maintain value and reduce churn.<\/p>\n

\u27a4 In B2B<\/strong>, O2 Business which has made significant integration progress in its first year will be focused on streamlining its product portfolio to cut complexity and better suit the needs of businesses; accelerating commercial execution and margin expansion; and delivering ~\u00a370 million pre-tax annual run-rate synergies by 2030.<\/p>\n

\u27a4 In wholesale<\/strong> the company will continue to sustain its position as the leading network of choice for MVNOs, and in fixed the company maintains strong credentials and capabilities to provide wholesale services through a single platform across the Virgin Media O2 and nexfibre footprints.<\/p>\n

\u27a4 Virgin Media O2 will continue to invest in its mobile<\/strong> network with a clear focus on reliability and connection quality. This investment includes the continued expansion of 5G<\/a>+, alongside O2 Satellite<\/a>, utilising AI tools and Virgin Media O2\u2019s network sharing arrangement with Vodafone<\/a> to ensure efficiency, and the deployment of acquired spectrum, taking the company\u2019s share to ~30%.<\/p>\n

\u27a4 On the fixed network<\/strong> side, Virgin Media O2 will halt investment in further fibre upgrades beyond its existing commitments to partners. Market economics do not support three overlapping fibre networks, and the company\u2019s HFC network will continue to deliver market-leading broadband at scale, with a low-cost upgrade being deployed to bring 2Gbps services to the majority of the network in 2027. Where any future fibre investment makes strategic sense, it will be supported off-balance sheet and only in non-altnet areas. The company is also exploring wholesale arrangements to support the expansion of its services to offnet areas not covered by Virgin Media O2 or nexfibre\u2019s networks, providing an incremental revenue opportunity and flexibility for future.<\/p><\/blockquote>\n

In short, the operator has confirmed that pretty much all of the recent news leaks were largely accurate. Sadly, this does mean that customers in their HFC areas, where the FTTP upgrade programme has yet to reach, will now be stuck on HFC (note: the existing upgrade programme hasn’t suddenly stopped, it’s more in a ramp-down to complete existing commitments). But there is still scope to upgrade HFC itself, even though it will struggle to match the symmetric performance of modern FTTP lines.<\/p>\n

Organisational changes are also already underway with a significant reduction of senior leadership roles since the summer. This includes Executive Committee changes and the bringing together of the previous commercial and operations areas of the business under Consumer CEO, Lyssa McGowan. Further reductions will occur across the wider business, with proposals subject to consultation.<\/p>\n

Other significant cost measures will include reducing the use of contractors, simplifying supplier relationships and supply chain and reviewing technology licences.<\/p>\n

Lutz Sch\u00fcler, CEO of VMO2, said:<\/strong><\/p>\n

“The direction we\u2019re setting today paves the way for the next chapter of Virgin Media O2: a company that will be leaner, clearer on priorities and faster in delivery, with brilliant brands and an unwavering focus to get back to what really makes a difference to our customers. Given the market conditions we face, the regulatory backdrop in fibre and the technological changes sweeping across all areas of the economy, standing still and doing what we\u2019ve always done is not an option and while many of these decisions are tough, they are necessary for our future success and growth.<\/p>\n

While we will give a fuller update on the new strategic plan in the coming months, we are already progressing and making difficult decisions to prioritise investments and reduce costs which includes the size of our workforce. This is not something I take lightly but my commitment to our people is that for those leaving we will treat them fairly and with respect, and for those staying we will work differently, but as one team, to get back to winning again. Virgin Media O2 must evolve, and the action needed to make that happen starts now.”<\/p><\/blockquote>\n

Officially speaking the CMA haven’t yet reached a final decision on the proposed nexfibre takeover of Netomnia<\/a>, although the new strategic plan does appear to suggest that VMO2\/nexfibre are not currently expecting the competition regulator to perform a sudden U-turn on their provisional rejection. But such a dramatic reversal does still remain a possibility, until the final outcome is revealed.<\/p>\n

On the flip side it’s a good thing to see Lutz recognising that “doing what we\u2019ve always done is not an option<\/em>” and the recent move to make contract renewals cheaper<\/a> for existing customers is a positive sign for consumers.<\/p>\n

The reality is that VMO2\/nexfibre had a lot riding on the extra investment that their deal with Netomnia<\/a> would have delivered and without that they’re having to make some difficult decisions. Some of those decisions might have happened anyway, but we doubt they would have been as big.<\/p>\n

Headline Figures (Official Summary)<\/strong><\/span><\/p>\n

Customers<\/strong><\/p>\n