Swedish infrastructure giant Ericsson says it will cut an additional 1,500 jobs as it struggles to compensate for an ongoing slump in sales. The company announced last year that it would cut 5,000 employees from its payroll. That number will now reach about 6,500.
"We know that we are facing a great challenge. We know that the markets will be extremely difficult. It's a very challenging environment," ST-Ericsson President and CEO Gilles Delfassy said in an earnings call with analysts transcribed by SeekingAlpha. ST-Ericsson is a joint venture of STMicroelectronics and Ericsson.
Ericsson's cost-cutting efforts took a chunk out of its bottom line. Its restructuring charges almost doubled to SEK 4.3 billion, or $594 million.
Together with a 13 percent decline in fourth-quarter sales, which fell to $43.3 million, the company's fourth-quarter profit crashed by 92 percent, to kronor (SEK) .10 – about 1 cent U.S. - per share from SEK 1.21 per share last year. Its full-year results weren't much better, slipping 68 percent to SEK 1.14, or 16 cents per share.
The company's full-year restructuring charges hit SEK 11.3 billion, or $1.56 billion. For 2010, the company says that instead of working toward a "magic milestone," it will work on developing new products and improving its bottom line.