• by bcarlson@marketresearch.com
  • February 9 2015

Siemens’s Layoffs: IVD Market Impact

Where will the cuts go?  That’s the question being asked as Siemens announced that they will eliminate more than 2% of its workforce in a streamlining move meant to save $1.13 bil (1 bil euros). The company plans to layoff 7,800 employees.   Kalorama covers Siemens, and other top tier IVD companies, in its report, The Worldwide Market for In Vitro Diagnostics, 9th Edition.  http://www.kaloramainformation.com/Worldwide-Vitro-Diagnostic-8326563/

Siemens has not commented on where layoffs would be but news reports say that about 3,300 of the job reductions may affect Siemens’s German operations.    

The move appears to be about profit.   Revenues at Siemens Healthcare, best known for its imaging devices, were up 6% to almost €2.9 billion ($3.32 billion), but profit declined 13% to €413 million ($472 million), in large part due to shrinking profit margins. They fell from 17.6% to 14.5% year over year, to the concern of the equity analysts participating in the earnings call. 

Considered in the light of the company’s moves last year to sell its audiology, microbiology and computer IT units, it could be seen as the company shedding some weight in the healthcare side to focus more on energy.     However, it’s probable that even with such a shift, Siemens remains a strong player in immunoassays and molecular diagnostics.      

Kalorama thinks its likely that Siemens remains among the top three IVD companies, though a combined Danaher presents a strong challenge.