Germany’s Siemens (News - Alert) AG wants to cut its costs by $7.7 billion in two years, and cut an unspecified number of jobs and boost sales by a third in a few years.
In addition, Siemens says in a statement it will make several cost-saving changes to the company.
"We know what we have to do, and we're doing it," Siemens CEO Peter Loescher said in a recent company statement. “A strong fourth quarter enabled us to fulfill our expectations for fiscal 2012 and achieve one of our best years ever. Even so, we didn't fully succeed in significantly boosting our performance vis-à-vis competitors, as we did in recent years. To get back to reaching our own goals, we've launched ‘Siemens 2014,’ a company-wide program aimed at raising our Total Sectors profit margin to at least 12 percent.”
For example, the company will restructure its water technology business. The water business will focus on automation and drives, and the company will sell off operations related to the processing and treating of water and wastewater.
Siemens is also acquiring LMS International, which provides a software platform for the modeling, simulating and testing of mechatronic systems in vehicles and airplanes.
In addition, the company announced on Oct. 22 it would sell its solar business and concentrate on wind and water.
The company also says that its “worldwide infrastructure will be further optimized, and redundant functions and duplicate processes will be eliminated.”
Some sector analysts appear pleased with the announcements.
"We see the cost program (at Siemens) as meaningful and credible. This is much better than many had expected," Morgan Stanley analyst Ben Uglow told Reuters.
The company also recently announced that its revenue for Q4 went up 7 percent compared to Q4 2011. Overall, Q4 net profit from continuing operations fell by 2 percent, according to TMCnet. That’s more than analysts predicted.
Edited by Braden Becker