KPN telecoms firm announces profit warning and job cuts
Dutch telecoms group KPN is to cut its workforce by up to 25% - about 5,000 people - as it struggles with fierce competition and falling demand.
KPN issued a profits warning on Thursday, sending its share price tumbling 7.8% and forcing a brief suspension in trading.
The company cited continuing problems at its mobile and fixed-line divisions.
The news marks Eelco Blok's first steps to stamp his authority on KPN since becoming chief executive this month.
Last week, Telefonica said it may shed 20% of its staff - about 6,000 people - at its underperforming Spanish unit by 2013.
KPN's announcement hit the share prices of other telecoms companies, with Vodafone down 4.3%, the biggest faller on the FTSE 100 in afternoon trading.
Analyst Peter Jurgens, from Keijser Capital, said: "There is tough competition from many directions. In the past there only was direct competition from phone companies but now you have all these cable companies."
KPN said it was cutting its profit forecast for 2011 to 5.3bn euros ($7.8bn; £4.7bn), down from more than 5.5bn euros stated earlier this year.
The firm surprised the market with the profit warning and by announcing its first-quarter results a week ahead of schedule. KPN said first-quarter profits fell 4.1% to 1.27bn euros compared with a year ago.
KPN competes in its home market with Vodafone and Deutsche Telekom, and also operates in Germany, France, Belgium and Spain.