Consumer electronics manufacturer BenQ will lay off 527 staff, approximately half of them contract employees, from its mobile subsidiary in Germany.
"It has been nine months since BenQ merged with Siemens' handset division and established BenQ Mobile. During this time, market share and revenue continue to drop while the company continues to book losses," commented analysts from Masterlink Securities.
The Taiwanese manufacturer has been losing $3.1m per day since it took over the Siemens mobile operation, the China Economic News Service (CENS) reported, citing unnamed industry sources.
Siemens paid Benq more than $300m to take the troubled mobile division off its hands in June 2005.
The parent company has blamed problems at the mobile division, together with weak sales of LCD monitors and optical disk drives, for a drop in revenue this quarter.
"The revenue shortfall was also caused by delays in ramping up BenQ's newly launched handsets which we are in the process of correcting," said Eric Ky Yu, BenQ's senior vice president of finance, on Monday.
Benq reported revenues of approximately $570m at its core business for the month of June, down slightly from the previous two months.
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