Telecom equipment maker Ericsson said Friday it would slash 8,500 jobs worldwide, part of a cost-cutting program as financial headwinds push operators to rein in spending.
Ericsson, which had a total of 105,000 employees at the end of 2022, last month posted disappointing full-year 2022 earnings, as operators slow spending on rolling out the latest 5G networks due to the global economic slowdown and rising inflation.
The Swedish company said most of the layoffs would be implemented in the first half of 2023 and the rest in 2024, as it accelerated its $860 million cost saving plan announced late last year.
"We see potential to simplify and become more efficient across the company, especially in structural costs. But we are also working on our service delivery, supply, real estate and IT," spokeswoman Jenny Hedelin told AFP.
"It will, however, unfortunately also result in a need to address headcount. We believe a total of 8,500 positions will be affected", she said.
Ericsson said 1,400 of the job cuts were in Sweden, which had already been announced earlier this week.
For 2022, the group posted a 17 percent drop in net profit to 19.1 billion kronor ($1.8 billion).
Announcing those earnings in January, chief executive Borje Ekholm said the near-term outlook was "uncertain".
He said Ericsson had already begun to sense at the end of last year that network operators wanted to reduce assets and that it expects this to continue at least through the first half of 2023.
The company said Friday it expected to start seeing the effect of its cost savings plan from the second quarter of 2023.
