Philips to cut 4,000 jobs to save $296M

Philips, an Amsterdam-based medical device company, will cut 4,000 jobs as it weathers a recall of 18 million sleep apnea masks, The Wall Street Journal reported Oct. 24. 

The job cuts are 5 percent of its workforce, but will save the company an annual $296 million, according to the Journal

In September, Philips recalled 17 million sleep apnea masks because the device's magnets can interfere with implanted metal medical devices, such as pacemakers. The number of recalled masks has since crept up to more than 18 million products as of Oct. 19. 

The FDA has reported 14 serious injuries and zero deaths related to the recall. 

Philips CEO Roy Jakobs, who took over the role in mid-October, apologized for the strain the recall left on the healthcare industry. 

"The product recall of our respironics sleep apnea devices let down the many patients who relied on them, as well as the doctors and nurses caring for those patients, for which I am deeply sorry," Mr. Jakobs wrote in an Oct. 20 company post. "While I can point to many great ways Philips is helping to improve people's health and well-being, any quality issue across the company hurts."

In June 2021, millions of Philips Respironics ventilators were recalled because of a foam breakdown issue and has since been tied to 168 deaths. A separate problem then happened in late August in which nearly 400 devices were recalled because of a plastic issue

In its third quarter, Philips reported losing $1.28 billion, mainly because of its sleep and respiratory-care business.

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