Ericsson says profit shrinks, to cut 6,500 jobs

STOCKHOLM: Swedish telecom giant Ericsson said Tuesday its net profit fell by 92 percent in the fourth quarter due to the costs of a restructuring plan in which 6,500 jobs will be cut.

Ericsson reported a net profit of 314 million kronor (30.7 million euro, 43.4 million dollars) between October and December compared to 3.89 billion kronors in the same period in 2008, the company said in a statement.

The profit margin was much worse than expected as analysts polled by Dow Jones Newswires had forecast a net profit of 3.23 billion kronors.

Ericsson had planned to slash 5,000 jobs under a cost-cutting plan that was launched in January 2009, but the Swedish company said it would now lay off 6,500 people.