LONDON (ShareCast) - (Sharecast News) - Technology company Philips will cut as many as 6,000 jobs in an effort to restore profitability after its respiratory devices were recalled, wiping out roughly 70% of its market value.
Philips said on Monday that half of the cuts would be made in 2023, while the other 50% will take place by 2025.

The news comes hot on the heels of an announcement by the group back in October that it was looking to lower its global workforce by 5% as it struggles to bounce back from a recall that saw millions of sleep apnoea ventilators get returned to the firm amid worries that foam used within the machines could be toxic.

Philips reckons its reduced workforce will lead to a low-teens profit margin by 2025, and a mid-to-high-teens margin beyond that, with mid-single-digit comparable sales growth throughout.

"Philips is not capitalizing on the full potential of strong market positions as it faces a number of significant operational challenges," said chief executive Roy Jakobs.

Jakobs added that the group would continue to invest 9% of sales into research and development, but would now focus on "fewer, better resourced, and more impactful projects".

As of 0845 GMT, Philips shares were up 5.42% at €16.41 each.





Reporting by Iain Gilbert at Sharecast.com

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