News, Telecoms

Ericsson may shed 25,000 jobs in cost-cutting drive: report

Ericsson may lay off up to 25,000 employees outside Sweden as party of its savings programme, according to Swedish daily Svenska Dagbladet, citing unidentified sources from the company.

Ericsson CEO, Börje Ekholm

The telecommunications firm said in July that it would accelerate measures to meet a target of doubling its 2016 underlying operating margin of 6 percent. The company also revealed that it aimed to reach an annual cost reduction run rate of at least 10 billion crowns ($1.2 billion) by mid-2018.

Ericsson has said actions will be taken primarily in service delivery and common costs, while research and development would be largely unaffected.

Amid facing fierce competition from China’s Huawei and Finland’s Nokia, the company is also exposed to weak emerging markets and falling spending by telecom operators, with the demand for next-generation 5G technology still years away.

Svenska Dagbladet said it was not clear whether the planned layoffs included employees within its media operations, which are up for strategic review and seen by analysts as likely to be sold by the group.

“Ericsson has not communicated which specific units or countries could be affected. It is too early to talk about specific measures or exclude any country,” Ericsson said in a statement on its website.

The company has around 109,000 employees in total.

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