Barclays plans to eliminate 5,000 jobs, representing roughly 5% of its global workforce, as part of a cost-cutting initiative driven by artificial intelligence. Chief Executive Officer C.S.
The British lender detailed the workforce reductions in its third-quarter earnings report. About 60% of the planned job cuts will target support functions, which include software developers. The London-based institution employed approximately 93,000 people globally at the end of 2025. Having already eliminated 1,000 positions during the first six months of 2026, the bank plans to complete the remaining reductions before the end of the year.
Financial Results and Fixed-Income Slump
Barclays reported a 12% year-on-year increase in pre-tax profit to £2.3 billion ($3.1 billion), meeting forecasts compiled by LSEG. However, overall group income for the period reached £7.4 billion, falling short of analysts’ estimate of £7.61 billion. Net interest income held steady at £3.91 billion, while the CET1 capital ratio edged down to 14.2% from 14.3% at the close of the second quarter, and the return on tangible equity declined to 11.7% from 16.1%.
The shortfall was driven largely by the investment bank, where bond traders endured a steep downturn. Revenue from fixed income and currency trading dropped 19% compared with the previous year, landing at £1.01 billion ($1.4 billion) and missing analyst expectations. Venkatakrishnan described the fixed-income performance as somewhat disappointing
during a media call, attributing the weakness to reduced client activity in rates and credit alongside further adversity in September due to the macroeconomic environment.
Equities Revenue Surges as Retail Units Stay Stable
While debt trading slumped, equity traders provided a counterweight. Equities revenue surged 47%, marking the division’s strongest performance since at least 2009, the year after Barclays acquired Lehman Brothers’ North American business. The equities surge nearly matched the revenue haul of the fixed-income desk.
Consumer units offered a stable baseline that ultimately fell short of offsetting investment banking volatility. The UK retail division remained broadly stable, and the US consumer arm stayed flat year-on-year, missing internal expectations. As trading opened on the London market, shares in Barclays dropped as much as 2.4% before paring losses.
AI Efficiency Targets Aim for Billion-Pound Savings
Management emphasized that technological efficiency forms the core of the bank’s cost-discipline strategy. Barclays cut £201 million in expenses during the third quarter and scheduled another £300 million in cost reductions for the final three months of the year. The institution anticipates that efficiency measures augmented by artificial intelligence will generate over £1.1 billion ($1.5 billion) in annual savings by 2027.
The bank is structurally reducing its cost base to create financial capacity for fresh investment. Presentations from the earnings release cite organisational simplification and technology change efficiency driven by AI as primary mechanisms for the shift. Alongside the restructuring, the board announced a £500 million share buyback.
Investor Scrutiny Follows Fixed-Income Revenue Declines
Barclays’ cost-cutting follows months of scrutiny from investors regarding operational expenses. Similar trends appeared across Wall Street, where competitors like JPMorgan Chase, Goldman Sachs, and Bank of America experienced double-digit declines in fixed-income revenue as elevated interest rates dampened debt values and client transaction demand.
Despite the earnings miss, executive leadership maintained existing multi-year projections while UK lenders brace for potential tax increases in the government budget. Venkatakrishnan confirmed that the institution remains anchored to its broader strategic schedule.
With one quarter to go before the end of our original three-year plan, we have either achieved or are on track to achieve all of our 2026 group targets. We are confident in and committed to the 2028 targets that we laid out earlier in the year.
