Ericsson to slash nearly 14,000 jobs by Q3 2004
IDG News Service - After posting yet another quarterly loss, Sweden's LM Ericsson Telephone Co. announced plans to cut nearly 14,000 jobs by late 2004.
Ericsson's workforce of around 61,000 at the end of the first quarter of 2003 will shrink to 52,000 by the end of the year and to 47,000 by the end of the third quarter of 2004, President and CEO Carl-Henric Svanberg said today at a news conference to announce the company's quarterly results.
At the end of the first quarter of 2002, the company employed around 107,000 people, a company spokesman said.
Svanberg, who took over the helm of the financially troubled Swedish provider of wireless equipment and network services, is stepping up efforts to cut costs and return the company to profitability.
Ericsson posted a net loss of $504 million on sales of $3.1 billion for its first quarter, which ended March 31. The company reported a loss of $300 million on sales of $4.4 billion for the same period a year earlier, according to a company statement.
Earnings per share amounted to a loss of 3 cents, narrowly missing the forecast by SME Direkt, a Stockholm-based provider of analysts' consensus forecasts for Nordic companies.
Sony Ericsson Mobile Phones AB, the subsidiary into which Ericsson folded its mobile phone business, shipped 5.4 million units in the first quarter, down 7% compared with the first quarter of 2002, Ericsson said.
The Swedish company's focus on cellular infrastructure backfired after mobile operators in Europe spent billions on acquiring third-generation broadband mobile Internet licenses and the global economy weakened.
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