On Friday, Europe’s biggest home appliances maker and Sweden-based company, Electrolux, reported heavy losses in its third quarter which they have attributed to supply chain disruptions and weak market conditions. The company is also set to cut 4,000 jobs as a part of a cost-cutting programme.
The company reported a loss of at least 605 million Swedish kronor ($55 million) which is down from the net profit of 1.1 billion kronor last year. “Market demand in both Europe and North America for the full-year of 2023 is expected to further deteriorate, i.e. be negative year-over-year,” said Chief Executive Jonas Samuelson.
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This comes after the company had heavily invested in North America however the supply chain issues and component shortages have delayed local production in the region. The company has said that a majority of the targeted cost savings will also take place in this region and at least 3,500 to 4,000 positions will be affected.
The company’s North American business alone has reported a loss of 1.2 billion kronor ($109 million). However, they believe that this company-wide cost-cutting and turnaround programme in North America should lead to some positive earnings next year. Notably, by the end of 2021, Electrolux had 52,000 employees.
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The group also reported a $35.1 million operating loss in the third quarter despite their revenue increase to 35.2 billion kronor which is up from 31 billion during the same quarter in 2021, which the company has attributed to “strong price execution across all business areas”. Notably, Electrolux first announced the details of a cost-cutting programme in September.
(With inputs from agencies)
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