Virginia’s PSINet yesterday admitted that it has debts totalling $3.7 billion, that it is defaulting on its loans, and that it is likely to file for bankruptcy. It employs 6,000 workers in Europe and the US. Winstar and Viatel, both major US telecoms carriers with European interests, are also in financial difficulties.
Europe’s largest electronics manufacturer, Philips, yesterday announced it is cutting 7,000 jobs, mainly in its components and consumer electronics divisions, following its operating loss of 99 million euros (£61 million).
Chip maker Texas Instruments reported lower than expected profits and announced 2,500 job cuts, or 6% of its workforce. The company’s Chief Financial Officer described the outlook as “bleak,” with second quarter revenues expected to be down a further 20% from the first quarter.
Intel’s first quarter earnings fell by 82% on last year, in line with analyst expectations, although the company said orders were up towards the end of the first quarter. Last month, the company said it would reduce its workforce by 5,000 (6%).
Cisco announced on Monday that it will cut 17% of its workforce, around 8,500 jobs. Revenues for the quarter ended April 28 are expected to be down by 30%.
According to a report in FT.com, Ericsson is expected to announce a further 6,000 job cuts on Friday. The company has refused to comment on the report in advance of releasing its quarterly results. The telecoms equipment maker last month announced 2,000 job cuts and the closure of two mobile phone production plants in the UK.