The downturn in the economy is affecting various industries. The computing industry has been hit relatively hard and a number of tech giants have announced reduced earnings and job cuts.
The latest company to fall victim to the harsh realities of the current economic climate is Lenovo. Lenovo Group Ltd. announced its first loss in 11 quarters which sent its shares down 26 percent according to Bloomberg News. The company is doing everything in its power to reduce costs and that means that jobs cuts are on the way.
The company announced that it will cut 2,500 employees worldwide during the first quarter of 2009 — this represents 11% of its global workforce. The company also plans to cuts costs in various divisions including finance, human resources, and marketing.
“This is something they have to do. If they don’t do it, the company will have a huge loss,” said J.P. Morgan analyst Charles Guo. “We believed they had to do something drastic. This 11 percent is within our expectations.”
Source: DailyTech