NV Philips Sees $1-Billion Loss, Major Layoffs

Dutch electronics giant NV Philips, hit by a slump in its worldwide business, said Monday that it expects to suffer a huge loss this year and will cut 10,000 jobs as part of a radical restructuring.

The world’s second-largest consumer electronics concern, Philips forecast that it will report a net loss of $1.075 billion (2 billion guilders) in calendar 1990, in contrast with a profit last year of $740 million (1.37 billion guilders).

The predicted loss stunned analysts, who had expected NV Philips Gloeilampenfabrieken to make a small profit this year in line with the company’s earlier forecasts.

Its share price slumped nearly 7% to $16.56 (30.80 guilders) on the Amsterdam bourse in 30 minutes of hectic trading after the announcement.

Jan Timmer, who was formally elected president of Philips on Monday, told an extraordinary meeting of shareholders that the company would drastically restructure its business by making deep cuts in the total work force of 290,000.

The company, second only to Japan’s Matsushita among global consumer electronics concern, has been struggling to make its vast array of products profitable.

Although its consumer products, ranging from light bulbs to compact disc players, have held up relatively well, some ventures in computers and other high-tech areas have done poorly, analysts said.