Ericsson said it will slash 3,000 jobs in its native Sweden as it continues to struggle in a competitive worldwide market for mobile telecom gear.
The layoffs, which represent nearly a fifth of its Swedish workforce, will be a combination of voluntary and forced reductions primarily in production but also in research and development, sales and administration, Ericsson said. The company also plans to eliminate 900 consultant positions in Sweden.
“We have a clear goal that our R&D in Sweden would be world-leading, not least in next-generation systems. In the short term we have to reduce the number of positions in R&D, primarily within administrative roles,” CTO and Chief Strategy Officer Ulf Ewaldsson said in a press release. “At the same time our intention is to bring in new competence in new technologies. Therefore, we intend to recruit approximately 1,000 engineers in Sweden, primarily from universities, over the coming three years.”
Ericsson continues to struggle as carriers in mature mobile markets have largely completed LTE buildouts and are preparing to invest in 5G over the next several years. In July, the company posted a net quarterly profit of $186 million, down from $240 million during the year-ago period. Sales fell to $6.3 billion, missing analysts' predictions of roughly $6.44 billion.
Meanwhile, competition is increasing from China’s Huawei and Finland’s Nokia. Ericsson suffered through a rough first quarter as well, posting a 2 percent year-over-year decline in net sales due largely to a "continued weak macroeconomic environment."
Ericsson ousted CEO Hans Vestberg in July and has eliminated roughly 30,000 jobs around the world as part of a plan it announced in 2014. The company earlier this year said it had renewed parts of a seven-year, $5 billion managed services contract with Sprint that was set to expire in September; the move saw Sprint take on some Ericsson employees.
For more:
- see this Ericsson press release
- read Reuters’ report
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