Swedish telecom giant Ericsson reported a net loss of 10.9 billion kronor ($1.2 billion) in the first quarter of 2017.
By comparison, the networking and telecommunications company reported a net income of 2.1 billion kronor in the first quarter of 2016.
The loss, which was bigger than analysts had expected, is largely explained by provisions, writedowns and restructuring costs.
“Our result in the first quarter is unsatisfactory,” Ericsson CEO Börje Ekholm wrote in a comment.
“Our clients are having a hard time. We’re still seeing a stable situation in the networking operation, however,” Ekholm told TT news agency.
Ericsson now flags for structural changes.
“In the future we will focus on structural changes that will create longterm improved efficiency and a more competitive cost position,” Ekholm said.
In October 2016, Ericsson announced 3000 job cuts in Sweden, with significant staff reductions on its manufacturing sites in Borås and Kumla. But the engineering union is not worried that the announced structural changes could lead to new major redundancies.
“Of course money needs to be saved here and there, but I don’t think we’ll be seeing those brutal, demoralising schemes again,” Per Nordlander of the Swedish Association of Graduate Engineers told TT.