Ericsson to trim 1,500 jobs
After huge drop in fourth-quarter and full-year earnings, Ericsson is slashing more jobs from the ranks of its 80,000 workers worldwide.
Ericsson it is cutting 1,500 jobs from among its 80,000 global employees, the wireless equipment maker said Monday.
The company reported on Friday a huge downturn in fourth quarter and full-year 2009 earnings. For the quarter ended December, Ericsson saw its net earnings plummet 92 percent to 314 million million kronor ($43.4 million dollars), compared with the year-ago quarter. Sales dropped 13 percent to 58.3 billion kronor from the year-ago quarter.
For all of 2009, Ericsson's earnings were down 67 percent to 3.7 billion kronor ($512 million). Annual sales survived, though, falling only 1 percent to 206.5 billion kronor over the previous year.
The 1,500 job cuts are in addition to 5,000 layoffs Ericsson announced about a year ago after a 31 percent drop in 2008 fourth-quarter earnings, bringing the total to 6,500. After layoffs and budget cuts are completed around the second quarter of this year, the company is looking to save around 15 billion to 16 billion kronor ($2.1 billion to $2.2 billion) annually.
Ericsson is also hoping that new Chief Executive Officer Hans Vestberg can help steer the company to a recovery. Vestberg, who was chief financial officer, replaced former CEO Carl-Henric Svanberg on January 1.
The company has been buffeted by a number of factors, including a decline in spending on wireless equipment, tighter competition, and poor results from its Sony Ericsson joint venture.