Ericsson sees no market improvement yet. They have only got rid of the contractors and everything continues as before.
They wait for somehtig to happne to avoid take decisions. After the holiday season (between Thansgiving and Xmas, ERICY will hit 30SEK. Brace for it guys!
Ericsson sees no market improvement yet
By Reuters staff
Thursday, August 30, 2001
Loss-making Swedish telecoms equipment maker Ericsson does not see any signs of improvement in the market, a senior Ericsson official was quoted as saying on Thursday.
"It is important that we continue with efficiency measures... We are only at the beginning of the efficiency programme, and we still do not see any improvement in the market," Ingemar Blomqvist, who oversees the company's ambitious restructuring programme, told Ericsson's Contact weekly gazette.
Ericsson did not give any forecast for the third or fourth quarter when it reported second-quarter results in July, saying market visibility was low.
Ericsson, the world's biggest producer of mobile networks and third-biggest handset supplier, is struggling to return to profitability amid sagging demand in the sector, depressed by the global economic slowdown and high costs of third generation mobile telephony licences.
To return to the black, the company has launched a restructuring programme envisaging job cuts of up to 22,000 people, or one fifth of the workforce, and other measures which are to give 38 billion Swedish crowns (US$3.67 billion) of savings from next year.
"With the measures we have decided on, we can reach this goal," Blomqvist said.
He said the efficiency program had already helped stop monthly costs of research and development from rising.
"Costs for research and development are no longer rising. Earlier they had always been increasing every month," Blomqvist said.
He said more synergy effects in the research and development area would come from the restructuring of the company's divisions, announced last week, which, for example, combine Ericsson's third-generation telephony WCDMA and second-generation GSM activities. |
