Consumer electronics giant Philips is planning on cutting jobs over various global divisions due to fourth quarter losses in 2008.
Philips reported losses of roughly $1.9 billion over the quarter and has consequently planned to axe 6000 jobs around the world to help ease the pressure of the downturn in the global economy.
The loss is the first posted in over five years for Philips and is not surprising due to the losses reported by most top-end consumer electronics companies.
“The fourth quarter losses are due to the soft economy that saw a record-low demand for the company’s products, with the hardest hit businesses being its lifestyle and lighting divisions. Philips’ management is giving absolute priority to cash flow, where necessary at the expense of operating profits,” Philips’ president and chief executive, Gerard Kleisterlee, said in a statement.
The company saw sales fall nine per cent over the quarter, but in some good news, there was a reported growth in their medical equipment division, which saw a 29 per cent increase in revenue.
But this increase failed to offset the 32 per cent drop in the consumer lifestyle division overall. But analysts are confident that this increase was substantial and it contributed to the consumer lifestyle division remaining profitable for the company.
Locally Philips Australia has been hit just as hard over the last few months and as Current.com.au reported previously, they made the decision to pull out of the television category entirely in the region by the end of 2008, in order to strengthen their consumer lifestyle and lighting categories.
But overall, Philips has had a disappointing last quarter in 2008, both locally and internationally and it doesn’t look like the first quarter of 2009 will be any better both for Philips and the consumer electronics marketplace in general.