Mobile network equipment developer Ericsson has announced that it will be changing its business model, which may result in almost 1,000 job layoffs.
The company initiated the changes as a result of declining revenues and increased market competition. As mobile device purchasers continue to buy modems and processors, the company's main focus of development, Ericsson continues to fall behind competitors.
Ericsson's chief executive Hans Vestberg said rapidly-changing market signaled that it would be too expensive for the business to succeed, Reuters reports.
"In addition, we believe we can use this money in a better way," Hans Vestberg told Reuters.
Ericcson's total employee count was estimated around 115,000 last June. The employee cuts are part of the company's larger move to make significant savings.
Although Vestberg did not mention specific figures in relation to the amount of money Ericsson would save from the employee cuts, his group did comment on the organization's profit and loss account.
"Modems will have no impact on Group P&L (profit and loss account) from the second half of 2015," the company writes in a statement, according to Reuters.
Ericsson has yet to announce plans regarding future employee cuts.
