By Dominic Chopping

 

STOCKHOLM--Ericsson AB's (ERIC) said Thursday that restructuring costs will be higher than previously expected this year as its efficiency program gathers pace in Sweden, but no further job cuts are planned beyond those already announced.

The Swedish maker of telecom-network equipment has been racing to cut costs in the face of intensifying competition from Chinese rivals and weak demand for its specialty wireless products, prompting the company to cut 3,000 Swedish jobs in an overhaul announced in October.

"The reductions in Sweden are progressing ahead of plan, resulting in an increase in estimated restructuring costs for 2016 of 5.5 billion-6.5 billion Swedish kronor ($606.3 million-$716.5 million), compared to the previously communicated estimate of SEK4 billion-SEK5 billion," it said.

As a result, restructuring charges for 2017 are expected to decrease somewhat, further details of which will be announced in the company's fourth-quarter report in January, it said.

Ericsson is betting on the development of faster wireless networks, called 5G, and software-based services such as the so-called Internet of Things and cloud computing. Over the coming three years, the company plans to recruit about 1,000 people in research and development in Sweden to bring in new competence in new technologies.

 

-Write to Dominic Chopping at dominic.chopping@wsj.com; Twitter: @domchopping @WSJNordics

 

(END) Dow Jones Newswires

December 08, 2016 03:27 ET (08:27 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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