The Dutch group Philips announced on Monday, January 30, the elimination of 6,000 jobs by 2025, after losses linked to a recall of defective breathing apparatus for sleep apnea which has plagued it for months.
This further downsizing, “difficult but necessary”, is in addition to the loss of 5% of its workforce, or 4,000 jobs, announced by the group in October, said Philips CEO Roy Jakobs.
Half of the job cuts will be made this year, the Dutch health-tech company said, adding that the other half will be made by 2025. The company is dealing with fallout from the recall of millions of used ventilators to treat sleep apnea, due to suspected toxicity of the foam used in these devices. This recall caused its stock market value to fall by 70%.
The downsizing should generate an Ebita margin (earnings before interest, taxes, depreciation, and amortization, in French “earnings before interest, taxes and amortization”) of around 10-14% (« low teens ») by 2025, and about 15-19% (« mid to high teens ») beyond that, with single-digit like-for-like sales growth, Philips said.