Ericsson To Cut 5,000 Additional Jobs; Weighed Down By Mobile Phone Sales

Telecom equipment giant Ericsson (NSDQ: ERIC) reported a 31 percent drop in Q4 profit today, blaming its mobile-phone joint venture Sony (NYSE: SNE) Ericsson, which faces restructuring charges and quarterly losses, Dow Jones reports. And, even though Ericsson saw its own sales increase by 23 percent, the Swedish company unveiled a deep restructuring plan of its own that would eliminate about 5,000 jobs (in addition to the 4,000 cut last year).

The cost-cutting measures will initially cost up to $832 million (7 billion kronor), but will lead to an annual savings of $1.2 billion (10 billion kronor) by the second half of 2010. Ericsson’s bottomline was particularly hurt by a $278 million restructuring charge (2.3 billion kronor) and a dramatic drop in the contribution from Sony Ericsson, which has posted two straight quarterly losses and took charges for job cuts.

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