Ocado is set to trim its research and development (R&D) workforce in the UK and globally as part of the company’s broader goal to achieve positive cash flow by 2026

Speaking of the changes today, chief executive Tim Steiner emphasised that the total figure would be “significantly” fewer than the 1,000 redundancies made across the business in 2023-24, however did not specify the exact number of job cuts expected.

He said: “The cost reductions we’re targeting are a low single-digit percentage of our global workforce.”

The technology giant said the plans to scale back R&D spending came in a bid to cut costs, having invested over £800m in the division over the past four years.

Steiner stated that the decision is “never something that’s easy or that we take lightly”, adding that “it’s a very difficult day for us to have to announce that”.

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Ocado employs nearly 20,000 people worldwide and operates around eight R&D sites across various countries. Around half of these are located in the UK.

It comes despite the group having seen its losses narrow, driven by more shoppers turning to Ocado.com for their grocery orders. In the 52 weeks ending 1 December 2024, the company reported a pre-tax loss of £374.5m, down from £393.3m in 2023.

The retailer’s shares have since dropped as much as 16% due to its disappointing growth forecast for the technology solutions  business.

The company also said that it was in continuous discussions with M&S regarding the final payment of £190.7m due in April as part of the pair’s joint venture deal, Ocado Retail.

This venture, which launched in 2019, has not met its performance targets, leading to negotiations over the payment. Ocado has previously suggested that it may take legal action to secure the agreed-upon amount.