KPN telecom cuts thousands of jobs
Dutch telecom giant KPN announced on Thursday it would cut between 4,000 and 5,000 jobs in the Netherlands - about 25 percent of its Dutch staff.
The company says the operation is part of a long-term cost-reduction effort. Most of the affected staff will be replaced through sub-contracting and ‘off-shoring of the back-office’.
In a statement, KPN’s recently appointed CEO Eelco Blok said he was witnessing negative trends in the Dutch market. He added that he was convinced that the company’s austerity measures would strengthen its Dutch activities.
KPN expects that profits this year will be lower than predicted because of changes in customer behaviour. The increasing use of social media and mobile applications has led to a reduction in phone and text messaging traffic. KPN says that its current subscription formats are insufficiently geared to this trend.
The price of KPN shares dropped sharply in reaction to the lower profit forecast issued on Thursday. The company saw seven percent of its quoted value evaporate in the first minutes of trading at the Amsterdam stock exchange.
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