British American Tobacco to cut 5,500 jobs in AI overhaul

British American Tobacco will cut 5,500 jobs and move another 3,500 roles to strategic partners, a restructuring that will affect about 20% of its global workforce as the company pushes ahead with an AI-driven overhaul of its operations.

The changes excluded the United States, BAT’s biggest market, and most of the measures had already been confirmed with employees. Remaining consultations were still under way in line with local requirements. BAT did not disclose how many jobs would go in the United Kingdom, where it employs hundreds of staff, mainly in group functionality roles.

The cuts form part of Fit2Win, a programme launched in 2025 to make the company more agile, more cost disciplined and more innovative. The restructuring is set to deliver about £600 million in annualised savings by the end of 2028, with £500 million already targeted by 2027. BAT shares fell more than 1% after the announcement.

BAT's core cigarette business keeps losing momentum. BAT expects the global cigarette industry to decline by about 2.5% in 2026, sharper than its earlier estimate of about 2%. That leaves the company leaning harder on newer nicotine products, including Vuse vaping devices and Velo nicotine pouches, even as the economics of that shift remain unsettled.

BAT is trying to build growth around those products while trimming costs elsewhere. In February 2026, the company posted a 2.3% rise in annual profit to £11.28 billion, helped by Velo gaining market share and sales of newer products increasing. Even so, regulatory challenges and delayed product launches are adding pressure.