Ericsson | Image: Unsplash
5G slack-led headcount reduction: As part of cost cuts announced earlier this year, Ericsson has decided to lay off around 1,200 employees in Sweden due to lower customer spending on 5G equipment.
Telecommunications equipment suppliers such as Ericsson and Finland’s Nokia are expected to slow in 5G equipment sales in North America after laying off thousands of employees last year and also fall from record levels in India by 2024. We expect the difficult situation to continue in 2020.
Ericsson said it may consider further cost-cutting measures this year, including layoffs, but did not provide specific numbers. The company on Monday did not release numbers on how much cash it would save from the layoffs, citing ongoing negotiations with unions.
“As mentioned above, Ericsson expects the mobile network market to be challenging in 2024, with traffic volumes contracting further as customers remain cautious,” the company said in a statement. The company said it would continue its efforts to improve operational efficiency during 2024, adding that it would not make a separate statement on this.
PP Foresight analyst Paolo Pescatore said: “This is not the first (wave of job cuts). It won’t be the last. China’s challenges will lead to further job cuts later this year and into 2025. He added that there is a possibility. “To be honest, 5G hasn’t been the explosive success that everyone expected, and it’s been very slow going,” he added.
Erickson said cost-cutting efforts include reducing the number of consultants, streamlining processes and reducing equipment. The company had about 100,000 employees at the end of last year, according to its annual report. Ericsson shares were down 0.75% at 1320 GMT.
(according to Reuters information)
