Why IG should lay off employees？

IG's job cuts are driven by a desire to reduce expenses, with savings of up to £50m a year expected from job cuts and other so-called efficiency measures, which will be carried out across IG's global operations.。

Like many other brokers, IG's client trading activity has declined due to higher living costs, lower client disposable income and lower risk appetite。

What about IG's recent transactions？

In its latest fiscal 2024 first quarter trading update, the CFD broker revealed that revenue from its core over-the-counter derivatives trading business fell by just under £17 million compared to the same period last year (-8.0%), despite growth in revenue from both its OTC and equity trading and investment businesses。

The spread betting broker also reported that the number of active traders increased from 27 in the same period in fiscal 2023..930,000 down to 26.70,000 people。

Charles Rozes, Acting CEO of IG, said: "We want to position IG Group as a lean fintech company and today's decisive action will ensure a strong platform for future growth.。We will continually evaluate and pursue cost-effective opportunities to create a more flexible and scalable organization。In this process, IG will provide comprehensive support to employees, which, while not easy, will ensure that the company is fully prepared for continued long-term success.。"

Funds still available for buybacks

IG Group continues to buy back shares despite weak trading, which was approved in July this year 2.Part of the £500m mandate。

Since August, the company has bought just under £100m worth of IG shares, equivalent to about 15.3 million shares.。Over the past 25 years, the company has seen extraordinary growth in its business and is now worth just under £2.5bn.。

The Board of Directors of IG must act in such manner as it deems to be in the best interests of the Company and its shareholders。

However, two points are questionable。First, following June Felix's recent departure due to poor health, the company has no permanent CEO, and one wonders if this decision should be made by her successor rather than her stand-in.。

Second, I can't help but ask why the company continues to buy back shares when it's trying to cut costs.？After all, one of the most effective ways to improve cost-effectiveness and efficiency is definitely to stop unnecessary expenses。