Ericsson to slash nearly 14,000 jobs by Q3 2004

Sweden's Telefonaktiebolaget LM Ericsson plans to cut nearly 14,000 jobs by late 2004, after posting yet another quarterly loss.

Ericsson's workforce of around 61,000 at the end of the first quarter 2003 will shrink to 52,000 by the end of the year and 47,000 by the end of the third quarter of 2004, President and Chief Executive Officer Carl-Henric Svanberg said Tuesday at a press conference to announce the company's quarterly results.

At the end of the first quarter in 2002, the company employed around 107,000 people, a company spokesman said.

Svanberg, who took over the helm of the financially troubled Swedish provider of wireless equipment and network services, is stepping up efforts to cut costs and return the company to profit.

Ericsson posted a first quarter net loss of 4.3 billion Swedish kronor (US$504 million as of March 31, the last day of the period being reported) on sales of 25.9 billion kronor. This compared to a loss of 3.0 billion kronor on sales of 37 billion kronor for the same period the year before, the company said in a statement.

Earnings per share amounted to a loss of 0.27 kronor, missing the forecast of 0.25 kronor per share from SME Direkt, a Stockholm-based provider of analyst consensus forecasts for Nordic companies.

Sony Ericsson Mobile Phones AB, the subsidiary into which Ericsson folded its mobile phone business, shipped 5.4 million units in the first quarter, down 7 percent compared with the first quarter of 2002, Ericsson said.

The Swedish company's focus on cellular infrastructure backfired after mobile operators in Europe spent billions on acquiring 3G (third-generation) broadband mobile Internet licenses and the global economy weakened.

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