The largest independent ISP in the US, PSINet, has said it is
likely to file for bankruptcy. Meanwhile, Philips Electronics plans
to cut 7,000 jobs as first quarter (Q1) net income falls by 91%.
Texas Instruments will cut 2,500 jobs as Q1 profits fall by 45%.
Intel profits are down 62%. Cisco will cut 8,500 jobs. Ericsson is
expected to cut 6,000 jobs in addition to the 2,000 cuts recently
announced.
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.
