Pfizer Predicts Earnings Decrease and Plans Job Cuts
Pfizer expects its earnings to decrease by 6% this year as a result of the company’s struggles with patent expirations and drug safety concerns.
Pfizer also announced a plan to cut jobs and other costs potentially saving the company $4 billion by 2008.
According to an Asscociated Press article,
“Pfizer, which employs 8,500 people in Michigan, said the program would help return the company to double-digit earnings growth in 2006 and 2007. Wall Street responded by driving the company’s shares up 4 percent.
Details of the plan were sketchy but are to include staff reductions, changes to purchasing arrangements and possibly more plant closings. Further acquisitions are likely to add new technologies, too, the company said.
Pfizer’s projection for this year fell below analysts estimates, but the promise of a return to double-digit earnings growth by next year exceeded their expectations.”
“There won’t be a single ‘magic bullet’ or ‘big bang’ new strategy or business model,” explained Pfizer Chairman and CEO Hank McKinnell. “It will take a combination of both long-standing strategies and new approaches to prosper during the next decade.”
The company said that the job cuts will likely include manufacturing and sales positions, but made no specifications as to how many or when.
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