Nortel cuts 2,100 jobs after more big losses
Redundancies are just one part of Nortel's plan to revive itself after reporting a tremendous net loss for its last quarter.
Job cuts and relocations are in store for thousands of employees of Nortel, the Canadian telecoms equipment maker, after it reported another round of big losses.
After reporting a $844 million (422 million) net loss for the fourth quarter of 2007, the company announced a major restructuring plan for 2008, cutting 2,100 jobs and relocating an additional 1,000 employees to "lower cost geographies."
The company predicts this move will save it $300 million (150 million) annually. Nortel will also sell off some of its real estate assets to raise money.
News of the redundancies is just the latest development in Nortel's ongoing attempts to restructure itself and return to profitability.
"We are just over two years into a major transformation of Nortel," said Mike Zafirovski, chief executive of the company. "Significant progress has been made while upholding the highest standards of ethics and integrity."
Thanks in part to a drop in sales in the US, Nortel's revenue for 2007 was down four per cent year on year to $10.95 billion (5.48 billion). With no upturn to the US economy in sight, the company is predicting revenue to grow in the low single digits for 2008.
Nortel's sales of telecoms equipment continue to struggle as more companies switch to wireless technology from the company's traditional wired devices.
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