Amended: Philips Slips To Loss In Q3, Sees Weak Sales In Q4; To Cut Around 4,000 Jobs

Dutch consumer electronics giant Philips Electronics NV (PHGFF.PK,PHG) reported Monday that its third-quarter net loss was 1.33 billion euros, compared to last year’s profit of 2.98 billion euros.

Loss per share was 1.50 euros, compared to profit of 3.24 euros a year ago. Adjusted income per share from continuing operations was 0.25 euro, compared to 0.40 euro a year ago.

Sales grew 4 percent to 4.31 billion euros from last year’s 4.16 billion euros. Sales fell 5 percent on a comparable basis. Comparable order intake decreased 6 percent, on the back of 47 percent growth in the same period last year.

Philips said its performance in the quarter was impacted by operational and supply challenges, inflationary pressures, the COVID situation in China and the Russia-Ukraine war.

Looking ahead, the company sees prolonged operational and supply challenges, a worsening macro-economic environment and continued uncertainty related to COVID-19 measures in China, which will be partly offset by Philips’ productivity and pricing actions.

Philips now expects a mid-single-digit comparable sales decline for the fourth quarter of 2022, with a high-single-to-double-digit Adjusted EBITA margin range.

Further, Philips said it is taking immediate actions to restore performance.

Philips has initiated general productivity actions, including simplifying the organization to streamline the way of working and reduce operating expenses. This includes an immediate reduction of around 4,000 positions globally across the organization.

The company will elaborate further on its plans at the fourth quarter results publication in January 2023.

(Amended: corrects headline to change the period for outlook to Q4 from FY)

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