Healthcare technology company Philips is cutting 4,000 jobs worldwide, the company announced with its third-quarter results on Monday. In the Netherlands, there will be 400 forced redundancies on a workforce of 11,000 jobs, a spokesperson for the group said.
Turnover at Philips fell by 5 percent to 4.3 billion euros in the third quarter. In its quarterly report the company noted pressure on its bottom line caused by inflation, the Covid-19 situation in China, the war in Ukraine, supply chain problems, and operational issues.
As a result, Philips posted a third quarter loss of 1.5 billion euros, compared to a 358 million euro profit a year earlier. The loss was mainly driven by its costly recall for sleep apnea devices.
“Although Philips’ strategy and solutions resonate with our stakeholders, we have not lived up to their expectations in recent years,” said Roy Jakobs, CEO of Philips. “My immediate priority is, therefore, to improve execution so that we can start rebuilding the trust of patients, consumers, and customers, as well as shareholders and our other stakeholders.”
He said that to regain trust, Philips would first deal with the fallout from its recall of respirators by bolstering quality management and patient safety guidelines. The company will also improve its supply chain plans and streamline its operations to be more productive and agile.
“This includes the difficult but necessary decision to immediately reduce our workforce by around 4,000 roles globally, which we do not take lightly and will implement with respect towards impacted colleagues,” Jakobs said.