Most of the 850 redundancies to be made in Sweden as telco’s domestic fibre roll out hits bump in the road.
Telia Company announced it will cut 850 jobs as it looks for further savings, after the Sweden-based telco swung to a second quarter net loss.
650 of the redundancies will be made in its home market, where operating expenses are still too high, noted Telia CEO Johan Dennelind, in a statement on Thursday.
"The initiatives are expected to impact costs already in the second half of 2017 by a reduction of approximately 5% in Sweden year-on-year," he said.
Dennelind explained that Telia is still experiencing downward pressure on revenue from legacy services, and anticipates a one-off fall in fibre revenue.
In Sweden, Telia is reaching the tail end of its fibre deployment, he said, and is struggling with "permit and intermediary related issues in connecting households to our fibre network."
Second quarter revenue for the three months to 30 June fell 6.3% year-on-year to 19.8 billion kronor (€2.07 billion), as the revenue boost from the acquisition of Phonero in Norway, plus healthy growth in Finland and Lithuania, was offset by a disappointing quarter in Sweden and the sale of its Spanish arm, Yoigo. Group adjusted EBITDA fell to SEK6.1 billion from SEK6.39 billion.
Earlier this week, Telia issued a Q2 profit warning due to writedowns in Uzbekistan and Kazakhstan.
The full impact of those was there for all to see on Telia’s income statement on Thursday: the company swung to a quarterly net loss of SEK308 million, from a year-earlier profit of SEK3.9 billion.