NEW DELHI: Phillips has joined the long list of multinational brands in the reduction of workforce in recent times. And the reason for the same has been mentioned to be 'improve productivity and agility.
The global technology brand announced a reduction of 4000 positions globally. This came with the announcement of the report of their finances for the third quarter of the year. The official statement from the company mentioned that the sales in the third quarter of the year were affected by operational and supply challenges across multiple destinations.
Group sales during this period totalled 4.3 billion euros, with a 5 per cent comparable sales decline, in line with the update provided on October 12, the company statement mentioned. Operating cash flow was an outflow of 180 million euros, mainly due to lower cash incomes with increased inventories and higher consumption of provisions.
Philips CEO Roy Jakobs in the statement said that this step "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."
"These initial actions are needed to start turning the company around in order to realize Philips' profitable growth potential and create value for all our stakeholders," Mr Roy Jakobs said.
The company's performance in this quarter was impacted by multiple operational and supply challenges. Inflationary pressures, the COVID situation in China and the Russia-Ukraine war were some of the other reasons.
Previously technology companies like Microsoft and Meta, and popular consumer products brand Johnson & Johnson announced similar reductions. These steps have been said to be caused by the fears of a global depression in the economy due to the effects of the pandemic as well as the war Russia and Ukraine. Indian tech brands including Infosys and Wipro are still trying to recover from the problems of moonlighting.
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