Philips axes 300 jobs in research division

The research division of Koninklijke Philips Electronics NV plans to cut 300 jobs, or about 10 percent of its staff, but it doesn't expect the staff reductions to affect its product research operations, the company said Thursday.

Most of the job cuts will be made in areas affected by a slowdown in IT sales, such as the semiconductor, components and consumer-electronics areas, said Ellen de Vries, a spokeswoman at the Eindhoven, Netherlands-based Philips Research.

The restructuring doesn't mean Philips is cutting back on product innovation, according to De Vries.

"We don't want to slow the pace of innovation; this reorganization is about streamlining research not (about) less research," she said. "For example, more projects are being handled internationally ... we want to concentrate research on single subjects in single locations."

Philips Semiconductors and Philips Components sell to OEMs (Original Equipment Manufacturers) and make chips and products including CD drives for PCs and mobile phone displays. Philips Consumer Electronics makes audio and video equipment.

Philips Research, with offices around the world and about 3,000 staff, is the invention engine for the Dutch electronics giant. The unit invented the audiocassette, the compact disc and more recently announced it succeeded in creating a flexible display for mobile devices, De Vries said.

In response to a slide in consumer confidence and the overall economic uncertainty, Philips has said it would cut more than 10,000 jobs this year as it tries to cut overhead costs by 25 percent. The company expects to post a net loss before charges of 600 million euros (US$527 million) for the full year 2001. The reorganization at Philips Research is to be completed during 2003, Philips said.

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