London, Feb 26, 2026, 12:49 (GMT)
- Ocado is targeting £150 million in savings and will slash roughly 1,000 jobs, most of them in the UK.
- Technology and support jobs are bearing the brunt of the cuts, but the UK grocery partnership with Marks & Spencer remains untouched.
- Partner warehouse shutdowns have knocked confidence in Ocado’s automated fulfilment setup, prompting the move.
Ocado Group plans to eliminate around 1,000 positions—just under 5% of its staff worldwide—as the company looks to rein in expenses and stabilize cash flow.
The company’s proposal comes as it tries to persuade retailers to embrace its large, robot-operated grocery warehouses. But the strategy has hit turbulence—major North American partners have pulled the plug on multiple locations, raising fresh questions about the pace of growth.
Ocado posted a 59% jump in underlying earnings, hitting £178 million for the year. The figure, which leaves out some one-off items, landed as the company detailed its restructuring. Ocado is now aiming to swing to positive cash flow in the second half of its 2025/26 financial year—expecting to bring in more cash than it spends. Reuters
Roughly two-thirds of the cuts land in the UK, with most of those roles reportedly tied to Ocado’s Hatfield, Hertfordshire headquarters.
According to the company, roughly 50% of the job cuts hit research, development, and other tech roles. The remainder fall under support functions. Staff working in the retail division aren’t affected, Sky News reported.
Ocado plans to pull back on research and development outlays and will combine its Ocado Solutions arm with Ocado Intelligent Automation, folding both into a single unit as it sharpens its structure. The company cited “AI efficiencies” and a focus on “cost discipline” as drivers behind its effort to rein in expenses. Theguardian
Chief executive Tim Steiner said, “Regrettably, this means a significant number of roles will no longer be required.” He added the company plans to support employees impacted by the process.
Ocado shares tumbled in early London trading. The stock has lost over a third of its value in the past year, as investors remain uncertain about the pace at which its automated warehouse strategy can turn a profit.
In Britain, Ocado’s reputation sticks mostly to its online grocery arm. But the company’s real bet is overseas, pitching its Ocado Smart Platform — a package of warehouse robotics and software — to foreign retailers. Its UK retail side, run jointly with Marks & Spencer, is reported as a separate operation from the tech segment.
Problems with major international partners are dragging. Ocado flagged that Sobeys, its Canadian partner, is shutting down a robotic site in Calgary. In the U.S., Kroger has pulled the plug on three warehouses. Those closures have weighed on sentiment about the spread of Ocado’s “customer fulfilment centres”—automated hubs designed for online order picking.
Morningstar’s Verushka Shetty pointed out that the wave of partner closures has dented investor confidence, despite Ocado’s efforts to push “capital-light” automation. “However, our main concern is a negative flywheel effect,” she warned. Shutdowns and the drag in CFC expansion, she said, can put off potential new partners and make current ones think twice about growing their operations. Sky
But there’s a catch to the savings plan. Slashing research spending could shore up cash for now, but it threatens to stall the very upgrades and deployments Ocado relies on to land new contracts. That’s a bigger risk as more retailers favor using their current stores to handle online orders, rather than investing in purpose-built automated sites.
Those job cuts come on top of previous technology layoffs, a sign of just how rapidly Ocado has been forced to rethink its strategy after betting big on expansion and bold growth targets.
