Dutch group Philips posted a net loss of € 1.3 billion in the third quarter, mainly due to a large charge for a huge recall of defective sleep apnea breathing machines, and announced the cut of 4,000 employees. .
Underlining the “need for better execution”, new Philips CEO Roy Jakobs shared the “difficult but necessary decision to immediately reduce our workforce by around 4,000 positions worldwide”, equal to 5% of its strength. overall work. The group expects charges of approximately € 300 million in the coming quarters following the immediate start of these restructuring actions.
Sales at 4.3 billion, down 5%
Philips warned nearly two weeks ago that it expects to experience an impact in the third quarter from a massive recall of faulty sleep apnea breathing machines.
The loss of 1.3 billion euros in the third quarter comes from a net profit of 3 billion euros a year ago, mainly due to the sale of the household appliances business in March. In the third quarter, the Philips group recorded sales of 4.3 billion euros, a decrease of 5%, in line with the indications provided two weeks ago: new orders fell by 6% after the growth of 47% in the third. quarter of 2021.
Philips recorded an operating loss of € 1.5 billion compared to a profit of € 358 million in the same period of 2021. Adjusted EBITA was € 209 million, or 4.8% of sales, compared to € 512 million (12.3 %) of the third quarter of 2021. Commenting on the data, the new president and CEO Roy Jakobs – in office since October 15 – acknowledges that “in recent years we have not lived up to the expectations of stakeholders” and announces the maxi-cut to organic.