Ericsson announced this week that it would lay off 700 employees, or about 17 percent of its U.K. employee base, as it plans to shut down its Coventry R&D headquarters. Ericsson's plan, similar to Nokia Siemens Networks' recently announced restructuring plan, is to reduce its staff as part of a $1.45 billion cost cutting program after Q3 revenues slid.
The company has had a presence in Coventry since it bought out the majority of Marconi's telecom assets in 2006. Ericsson plans to move ongoing R&D work at the Coventry site to other countries that it says have "significant scale and product synergies." In addition, new R&D activities will move to countries that have a lower cost base.
This latest move comes after a tough third quarter at Ericsson. Citing poor performance in emerging markets and slower spending cycles, Ericsson reported that Q3 revenue fell 6 percent and profit fell 74 percent, respectively.
- Financial Times has this article
Ericsson sees major dip in Q3 09 profit
Ericsson: Q2 net profit drops, but service demand rises
Ericsson could be likely bidder for Nortel's MEN
Sprint hands wireless and wireline network keys to Ericsson
AT&T invites Ericsson to preferred wireline suppliers club