On 26 January, Signify, the world’s largest lighting manufacturer based in the Netherlands announced plans to cut 1,000 jobs in 2024 as part of a cost-cutting initiative. The company, which was spun off from Philips in 2016, revealed a cost-cutting plan in December aimed at saving 200 million euros ($216.5 million) annually. The specific number of job cuts was not disclosed at that time.
The layoffs will be implemented across 30 countries in 2024, with less than half of them occurring in the Netherlands, according to CEO Eric Rondolat in a press call. Signify had a workforce of approximately 32,000 employees at the end of 2023. The company’s fourth-quarter net income was adversely affected by higher restructuring costs, falling to 59 million euros, well below the anticipated 104 million according to analysts in a company-provided poll. This resulted in a more than 6% decline in shares during early trading.
Rondolat emphasized the company’s commitment to protecting its gross margin and focusing on cost reduction. Signify aims to enhance its adjusted core profit (EBITA) margin by up to 50 basis points in 2024. The adjusted EBITA for the fourth quarter reached 209 million euros, reflecting a margin of 12.1%, surpassing analysts’ expectations of 11.7%.
Despite facing challenges in certain markets and segments, Rondolat highlighted Signify’s success in gaining share with its professional connected systems. The infrastructure market demonstrated a “good level of traction,” while lighting systems for retail, hospitality, and offices experienced a significant slowdown due to delayed investments.
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