Philips says weaker demand means low profits

Royal Philips Electronics NV has warned their investors about the weaker demand this season, which would result in lowering profit figures for the company. The notification comes before an analyst meeting today where Philips would be focusing on the Medical Systems division. Philips CEO Gerard Kleisterlee released this news to the press after monitoring the progress of the company in the last couple of weeks.

Kleisterlee said: “Economic indicators around the world point to reduced growth rates. Europe in particular is suffering from a weakened consumer retail environment in the second quarter, hampering our growth ambitions in the short term.”

This warning resulted in a tumbling Philips shares in the market as the company suffers due to a poor retail environment. They are however sticking to their medium-term targets. The company would be spending around 75 million euro on its branding campaign in the current quarter with aims to recover in the time to come.

Philips is also looking forward to potential acquisitions or alliances for the medical division though they denied releasing further information on this topic.