BAT expected to cut jobs in plan to boost productivity

British American Tobacco (BAT) is set to cut jobs and increase its use of AI as part of efforts to “simplify” its operations.

The FTSE 100 tobacco giant confirmed plans to pursue “productivity initiatives” on Thursday as it reported stronger profits.

The Lucky Strike and Pall Mall maker’s interim finance boss Javed Iqbal told the Financial Times that initiatives are expected to reduce its headcount and make the business “more digital and AI-focused”.

BAT did not disclose the size and location of any job cuts.

The company operates in more than 140 markets and has around 49,000 employees globally.

The process is linked to the group’s Fit2Win programme launched by the business last year in a bid to reduce its costs.

It said the programme is designed to secure around £600 million of cost savings by the end of 2028.

In its fresh update, BAT reported that total revenues edged 1% lower to £25.6 billion in 2025, compared with the previous year.

Meanwhile, revenues from its new categories grew by 5.5% to £3.62 billion as the firm was boosted by surging demand for its Velo oral nicotine products.

Revenues from the group’s modern oral business, which is predominantly Velo nicotine pouches, leapt by 47.4% year-on-year with strong growth in the US, Scandinavia, the UK and Switzerland.

It helped to offset a fall in vaping revenues after it was “impacted by illicit products mainly in the US and Canada”, as well as excise changes in the UK and other markets.

Tadeu Marroco, chief executive of BAT, said: “I am pleased with our accelerating momentum through 2025, enabling full-year delivery at the top end of our guidance.

“This reinforces our confidence in sustainably delivering our mid-term algorithm from 2026.

“I remain committed to delivering sustainable shareholder value through robust cash returns, with progressive dividends and sustainable share buy-backs, including a £1.3 billion programme for 2026.”

Shares in the company were 1.1% lower on Thursday morning.