Ericsson announces more job losses as profits slump
Swedish telecoms equipment maker Ericsson is to eliminate a further 1,500 jobs, as it posted a 92% slump in fourth quarter profits.
The company said net profit for the October to December period was 314 million kronors (£27 million), compared with 3.89 billion kronors in the same period a year earlier.
The results were far worse than analysts had expected.
Meanwhile, the latest round of job cuts are in addition to the 5,000 positions that the company axed last year as part of its ongoing global cost-cutting programme.
The firm has been hit hard by the global economic downturn and said the mobile network market had suffered as a result and demand had weakened.
Sales for the fourth quarter plummeted by 13% to 58.3bn kronors as the telecoms businesses has also been hit by increased competition from China’s Huawei.
However, chief executive of Ericsson, Hans Vestberg, stayed positive and said that its joint ventures, including Sony Ericsson, were on target to return to profit.
“We maintained market shares well in all segments, cashflow was good and our financial position is strong,” he said.