Yet another dark consequence of the recessional choke this week following an announcement by mobile telecommunications heavyweight Sony Ericsson that it plans to cut some 2,000 jobs from its global workforce.
Sony Ericsson chops 2,000 workers after terrible Q1 reprot. Image: Sony Ericsson.
The announcement comes after Sony Ericsson issued a dour first-quarter (Q1) performance report that revealed the joint technology venture has lost €358 million Euros over the year’s opening three months, which is a sizeable year-on-year downturn when compared to the €184 million Euros profit it posted in 2008.
“As expected, the first quarter of this year has been extremely challenging for Sony Ericsson due to continued weak global demand,” commented Sony Ericsson president Dick Komiyama.
“We are aligning our business to the new market reality with the aim of bringing the company back to profitability as quickly as possible,” he added. “The management intends to pursue an additional cost saving program targeting a further annual operating reduction of Euro 400 million, to be completed by mid-2010.”
Beyond the obvious impact of a 38 percent plunge in Q1 sales to €1.7 billion Euros, the company has also seen quarterly handset shipments fall to 14.5 million, a drop of 35 percent when compared to the same period of 2008.
As a result of its ailing performance and an apparent lack of appealing mobile handsets, Sony Ericsson is actively looking to cut back on its operational costs by swinging the scythe of unemployment through some 20 percent of its 10,000-strong international workforce.
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The Tech Herald: Sony Ericsson loses North American division head
The Tech Herald: Sony Ericsson posts huge Q4 2008 losses
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