Ericsson Announces 1,200 Job Cuts in Sweden Amid Industry Slowdown
Ericsson AB, a leading provider of 5G networking equipment, has revealed plans to slash 1,200 jobs in Sweden as part of cost-cutting measures due to lower sales and cautious investment from mobile service providers. The company also aims to reduce costs by scaling back facilities, consultant usage, and streamlining operations.
Ericsson AB, a leading provider of 5G networking equipment, has revealed plans to slash 1,200 jobs in Sweden as part of cost-cutting measures due to lower sales and cautious investment from mobile service providers. The company also aims to reduce costs by scaling back facilities, consultant usage, and streamlining operations.
In a statement released on Monday, Ericsson AB highlighted the challenges faced by European telecom equipment manufacturers, including Ericsson and Nokia Oyj, in the wake of a slowdown in mobile services spending. The company indicated that the cuts amount to about 8.6% of its Swedish workforce as of the end of 2023.
The broader context of this move includes a persistent decline in market demand outside of China, with Ericsson cautioning earlier this year about continued decreases in 2024. Many mobile operators are maintaining low investment levels, leading to competitive pressures and reduced returns on investments in Europe.
Moreover, the emergence of “open radio access networks” poses additional challenges for companies like Ericsson and Nokia Oyj. This technology enables carriers to utilize multiple vendors more easily, introducing heightened competition for network components.
Ericsson’s decision to reduce its workforce follows a similar trend in the industry, with the company having announced cuts of 8,500 staff about a year ago. Nokia Oyj also disclosed plans to cut up to 14,000 jobs, reflecting ongoing efforts to navigate market challenges.
The news of the job cuts impacted Ericsson’s shares, which fell by 0.8% to 56.97 Swedish kronor, reflecting investor concerns about the company’s performance amid industry headwinds. For the year, Ericsson’s shares have declined by 9.9%.
The ongoing adjustments in response to market conditions underscore the dynamic nature of the telecommunications sector, as companies like Ericsson adapt to evolving industry landscapes and competitive pressures while striving to maintain operational efficiency and financial stability.
Sources By Agencies
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