New Philips CEO slashes 4,000 jobs in bid for financial turnaround
Philips is set to cut around 4,000 jobs – the equivalent of five per cent of staff – in Roy Jakobs’ first major move as CEO.
The Dutch conglomerate has had its sales fall for more than a year and has ultimately become loss-making.
The job losses will be based in the US and the Netherlands, according to Reuters, concentrated in business lines with falling sales.
Jakobs said the “difficult, but necessary” decision was critical for the businesses turnaround.
Earlier this month, Philips issued a profit warning to investors.
The group’s raked in €4.3bn (£3.7bn) in sales in the third quarter, it reported today, down five per cent in comparison with the same period last year.
The figure was in line with the update on 12 October, just days before Jakobs was appointed at group president and CEO.
In a statement today, Jakobs added that a top priority was to improve strengthen patient safety and quality management amid a recall of its Philips Respironics product.
The device was recalled in June last year over the risk of exposure to debris in chemicals as a result of the foam used to reduce sound in the devices, which could break down and enter the device’s air pathway.