Dow is slashing jobs and shutting down assets as it looks to make cost savings.
Photo:
Sean Proctor/Bloomberg News
Dow Inc.
DOW 0.40%
said it is laying off about 2,000 employees globally as job cuts that have so far been concentrated in the technology sector spread to other parts of the economy.
The Midland, Mich.-based chemicals company said it is targeting $1 billion in cost cuts this year as slowing economic growth and a drop-off in demand weigh on sales.
Dow said it is also shutting down certain assets and broadly looking to align spending with the macroeconomic environment. The company said it expects to book a charge of $550 million to $725 million in the first quarter for costs tied to the cost-cutting moves.
Chief Executive
Jim Fitterling
said the company is optimizing its cost structure amid macroeconomic uncertainties and “challenging energy markets, particularly in Europe.”
Shares of Dow rose less than 1% to close at $58.12 on Thursday.
Dow’s layoffs come after manufacturing conglomerate
3M Co.
said earlier this week that it was cutting 2,500 jobs globally, or about 2.6% of the company, as it confronts weakening demand.
The companies join a wave of technology companies that are cutting thousands of jobs as they recalibrate after growing rapidly at the start of the Covid-19 pandemic. On Wednesday,
International Business Machines Corp.
said it would cut 3,900 jobs, while software company
SAP SE
on Thursday said it would shed 3,000 positions.
Dow on Thursday also posted weaker-than-expected results for the fourth quarter. Revenue fell more than 17% to $11.86 billion, missing analysts’ estimates, with the company citing slowing economic growth around the world and destocking of inventory by customers.
The company’s fourth-quarter profit tumbled to 85 cents a share, down from $2.32 a share a year earlier. Adjusted earnings for the quarter missed estimates by a penny.
“While we see initial positive signs from moderating inflation in the U.S., improving outlook for energy in Europe, and reopening in China, we continue to be prudent and proactive,” Mr. Fitterling said.
Dow said it is targeting $500 million in structural improvements and another $500 million in operating cost reductions. The company said it would look to cut costs tied to purchasing raw materials, logistics and utilities.
Write to Will Feuer at Will.Feuer@wsj.com
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Appeared in the January 27, 2023, print edition as ‘Dow to Cut Headcount by 2,000.’