Osram saw its solid-state lighting performance grow rapidly in the third quarter and a faster than expected decline in traditional general illumination business. Against that backdrop, the company announced plans to continue on its cost-cutting path in its legacy business by eliminating 7,800 jobs worldwide over a period of three years —around 1,700 in Germany and 6,100 in the rest of the world.
“While earnings continue to develop nicely, the growing market acceptance of LED technology is, as already announced, causing a significantly faster decline of the traditional business,” said Wolfgang Dehen, CEO of Osram Licht AG.
Osram’s LED Lamps & Systems segment recorded revenue growth of 68% in the third quarter due to the fast-growing LED demand. The segment’s EBITA margin also improved in a year-on-year comparison but was still significantly negative at around –20%. The company’s Classic Lamps & Ballasts (CLB) segment’s revenue was down 14% on a comparable basis, while the EBITA margin excluding special items fell to slightly above six percent. The Luminaires & Solutions (LS) segment recorded a sales decline of 13% on a comparable basis in the third quarter due to the reorganization of the service business in North America. Thanks to strong growth from LED-based luminaires, the luminaires business posted a comparable revenue increase.