Rolls-Royce (OTCMKTS:RYCEY) layoffs are a hot topic on Tuesday as the company looks to reduce costs.
According to recent filings from Rolls-Royce, the layoffs are going to affect between 2,000 and 2,500 individuals. Investors in RYCEY stock will note that this represents roughly 6% of the company’s total global workforce.
One thing worth noting is that these Rolls-Royce layoffs are a continuation of changes made by CEO Tufan Erginbilgic. Erginbilgic has been making major changes since joining the company, including mixing up its leadership team. That hasn’t stopped with these newest layoffs affecting Chief Technology Officer Grazia Vittadini, who will depart the company in April 2024.
Nick Cunningham, an analyst at Agency Partners, said the following about the Rolls-Royce layoffs to Bloomberg:
“All this seems pretty obvious, and it is surprising this hadn’t already been done. The net effect should be to help to prevent costs growing as fast as sales and this should better enable incremental revenues to drop down to profits and cashflow.”
Rolls-Royce Joins Layoffs Trend
Investors will keep in mind that more and more companies have been announcing layoffs over the last year. This comes as economic pressures affect them. That includes the increased interest rates from the Federal Reserve as part of its efforts to reduce inflation.
RYCEY stock is down 1.5% as of Tuesday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.