Alcatel-Lucent Cut 4,000 More Jobs To Save Costs

Telecomms company Alcatel-Lucent has today announced it intends to lose another 4,000 positions over the next two years in a bid to continue its commitment to reducing costs in order to improve consistent poor performance over recent quarters.

The company today unveiled substantial losses totalling 260 million euros for the third quarter, continuing the poor performance that has seen it run aground since its formation in December 2006, which it hopes to turn around in future quarters.

This is to add to the 12,500 job losses announced in February of this year amidst struggling performance at that period, with figures continuing to disappoint markets and the media alike. The latest job cuts will see the total staff reduction amount to 20% of the entire workforce, with a view to saving around £280 million in costs.

The company had announced that it expected an increase in sales of around 5% over the year, a target that now looks increasingly less likely amidst performance over the last few consecutive quarters, unless the job cuts prove to cut back on expenditure to the extent planned by the board.

Revenues for the period were far short of analyst forecasts at just 4.35 billion euros, further indicating that initial sales targets may have been slightly too ambitious for the newly merged group entity.

The merger of Alcatel and Lucent was billed as bringing cost savings of almost $2 billion per annum, although the company has yet to find any momentum since the takeover, with shareholders quickly losing patience.

At the time of the merger, both companies individually were performing well, reporting an aggregate profit of over 520 million euros until the fateful decision to merge lead to significant additional costs and an overall reduction in profitability.

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