Ericsson announced that its restructuring programme will cost more than expected this year as it speeds up the cost-cutting in Sweden. In October the group announced plans to cut 3,000 jobs in Sweden and it has since largely competed the round of voluntary redundancies, with 1,600 people to leave the company by year-end. This means that the reductions in Sweden are progressing ahead of plan, resulting in an increase in estimated restructuring costs for 2016 to SEK 5.5-6.5 billion from the previously communicated estimate of SEK 4-5 bilion. This assumes that all global reduction programmes are executed according to plan.
Ericsson said restructuring charges for 2017 are expected to somewhat decrease as a consequence of faster implementation of the Swedish plans. It will announce an estimate for the figure at the Q4 results in January. The company added that it's on track to reach its target of SEK 53 billion in annual operating costs in the second half of 2017, with the lower costs reflected in the gross margin.
