Ericsson says Swedish staff cuts running ahead of plan
By Helena Soderpalm and Olof Swahnberg
STOCKHOLM (Reuters) - Struggling telecom equipment maker Ericsson (ERICb.ST: Quote) said on Thursday sweeping staff cuts in its Swedish home market were running ahead of schedule, resulting in higher restructuring costs this year.
The company said in October it was cutting about a fifth of its Swedish workforce and hundreds of consultants as it grappled with shrinking markets and competition from China's Huawei [HWT.UL] and Finland's Nokia (NOKIA.HE: Quote).
There has been speculation among analysts and staff at Ericsson about whether the company might need further cost savings to deal with tough market conditions and one analyst said it looked like more jobs could go be lost globally.
The company said it expected restructuring costs this year of 5.5-6.5 billion Swedish crowns ($606-717 million), higher than a previous estimate of 4-5 billion.
"Restructuring charges for 2017 are expected to somewhat decrease as a consequence of faster implementation of the Swedish reduction activities," the company said.
A precise estimate will be announced in January.
The company announced a plan in October to shed 3,000 jobs in production, research and development and sales in Sweden and cut 900 consultancy positions.
Around 820 jobs are to go at Swedish plants in Kumla and Boras, while 1,600 employees had taken voluntary redundancy, helping the company towards its targets. No further forced staff cuts were planned in Sweden. Continued...