Philips cuts 6,000 more jobs to improve profitability after sleep device recall

Philips has announced that it will cut  6,000 jobs to restore its profitability. This step is been taken following a recall of respiratory devices that knocked off 70 percent of its market value. According to Reuters the company said that half of the job cuts will be made this year, while the other half will be done by 2025.

The new restructuring follows a plan to cut 5 percent, or 4,000 jobs, from its workforce that was  announced in October last year as the company dealt with the repercussions from the recall of millions of ventilators used to treat sleep apnea due to concerns that the foam used in the devices could become hazardous.

The reduced workforce should lead to a low-teens profit margin (adjusted EBITA) by 2025, and a mid-to-high-teens margin beyond that year, with mid-single-digit comparable sales growth throughout.