Network infrastructure vendor Alcatel-Lucent plans to cut 5,000 jobs as part of a cost reduction programme. The firm is eyeing cost savings of €1.25bn after posting a net loss of €254m in its 2Q12 earnings result.

The company has already committed to cutting €500m costs but has now launched a Performance Program in a bid to slash costs by a further €750m by the end of 2013.

The announcement was made after the firm revealed that its second quarter revenue decreased 7.1 per cent year-on-year to €3.55bn.

“We have become a much more efficient company by rationalising our product portfolio, co-sourcing, reducing our cost structure, and managing our working capital better,” said CEO Ben Verwaayen.

“Despite having demonstrated our ability to deliver operational profitability, it is clear from the deteriorating macro environment and the competitive pricing environment in certain regions challenging profitability that we must embark on a more aggressive transformation. These times demand firm actions.”