Dutch electronics and medical equipment maker Philips announced that it is cutting 6,000 jobs worldwide over the next two years. This comes on top of a reduction of 4,000 staff the company announced in October. The job losses are due to a worldwide recall of sleep apnoea machines and economic headwinds, including Covid-related issues in China and the war in Ukraine.
In addition, Philips revealed a net loss of 1.6 billion euros (£1.49bn) in 2022, down from a net profit of 3.3 billion euros (£2.9bn) last year.
CEO Roy Jakobs said 2022 was “a very difficult year for Philips and our stakeholders, and we are taking firm actions to improve our execution and step up performance with urgency” He added that the job cuts were necessary for Philips to remain competitive in an ever-changing global economy.
The layoffs come as part of a larger restructuring effort by the company to focus more heavily on digital health initiatives such as remote patient monitoring technology and connected care services for elderly patients and those with chronic diseases.
The company also plans to invest in artificial intelligence (AI) technologies such as machine learning and natural language processing in order to develop new products that can better serve its customers’ needs while also helping boost its bottom line.
Philips has already started investing heavily in AI research, partnering with universities around the world on various projects related to healthcare robotics, diagnostic imaging systems, data analytics tools, and more.
Conclusion
The news of 6,000 job losses at Philips is yet another blow for workers amidst the pandemic-induced economic downturn around the world. While it is understandably difficult for those affected by these cuts, it’s clear that Philips’ restructuring efforts are necessary if they hope to remain competitive in this quickly changing environment.
As they continue to invest heavily into AI research and other digital health initiatives, hopefully, this will be successful enough to secure future jobs for employees both now and in years to come once economies begin recovering from Covid-19 restrictions all over the globe.
