Philips cuts 2200 jobs

Sept. 19, 2012
Philips plans to lay off 2200 workers between now and 2014, but the company has not stated what effect the cuts will have on the lighting division.
On September 11, Royal Philips Electronics NV announced in a press release that it intends to lay off 2200 workers worldwide by 2014. The job cuts will reportedly save EUR300 million ($383 million) a year. A spokesperson for the company stated that the effect on the lighting division is not known at this time.

Royal Philips Electronics employed 122,000 people at the end of 2011. As of July (Q2 2012), Philips had 52,000 employees in its lighting division. In April 2012, the company announced plans to cut 4500 jobs by 2014. Frans van Houten, Philips CEO said in a statement that “saving money will lessen ‘the effects of macro-economic headwinds and changes in pension cost accounting.’”

The job cuts will primarily come from the company’s Lighting and Healthcare divisions rather than its Consumer Lifestyle division.

In Q2 2012, Philips derived 34% of its sales from lighting products. The lighting business produces lamps, consumer and professional luminaires, automotive lights, LEDs (Lumileds division), and systems and controls. The company also reported that LED-based lighting sales grew year-over-year by 37% and accounted for 20% of its lighting revenues.

Van Houten said he expects the company to take restructuring charges of EUR210 million ($255 million) in 2012.