Ocado is preparing to cut up to 1,000 jobs as the British online grocery and technology group steps up efforts to rein in costs after a challenging year for its automated warehouse business,

according to a report by the Sunday Times.

The proposed cuts would affect roughly 5% of Ocado’s global workforce and could be announced as early as this month. Most of the redundancies are expected to fall at the company’s UK headquarters, with technology teams and back-office functions — including legal, finance and human resources — among those likely to be impacted, the report said, citing an unnamed source.

Responding to the report, an Ocado Group spokesperson declined to confirm details but said the company routinely reviews its operations.

“If and when decisions are made that affect our people, we are committed to communicating with them directly and ensuring they are supported throughout,” the spokesperson said in a statement to Reuters.

The potential job cuts come as Ocado grapples with a series of setbacks in its technology-led warehouse model, which it licenses to supermarket partners around the world. In recent months, Canadian grocer Sobeys shut down a robotic fulfilment centre in Calgary, while Ocado’s largest partner, U.S. retailer Kroger, announced last year that it would close three automated warehouses.

Facing mounting costs and slower-than-expected returns from its capital-intensive technology division, Ocado has doubled down on improving cash flow. In July, the company reaffirmed its goal of turning cash-flow positive during its 2025/26 financial year, which begins in December, with plans to achieve full-year positive cash flow the following year through tighter cost controls.

Ocado is scheduled to publish its annual results on February 26, when investors are likely to scrutinise progress on cost reduction and the outlook for its automation business. Photo by Tomjhpage, Wikimedia commons.