Alcatel-Lucent said it now plans to shed a total of 12,500 jobs, or 16 per cent of its work force, over the next three years, instead of the 9,000 originally announced.
It gave no details of where the cuts would be made. "The results are clearly disappointing and reflect tougher price competition and a spending slowdown among merging telecommunications operators ..."
Patricia Russo, Alcatel-Lucent CEO Patricia Russo, the company's chief executive, said in a statement: "These are difficult but necessary decisions, and we will manage these reductions with care."
The planned job losses fall short of the 15,000-20,000 suggested by a French media reports earlier this week.
The extra job cuts and other new savings will increase total merger-related synergies to $2.2bn from the $1.8bn previously forecasted, Russo said.
Russo said in a conference call: "The results are clearly disappointing and reflect tougher price competition and a spending slowdown among merging telecommunications operators, compounded by uncertainty for both our customers and our people in the short term."
Sales are likely to fall further in the first quarter, Russo warned, but full-year 2007 revenue is seen increasing in step with the market.
"We have now finalised Alcatel-Lucent's product portfolio," she said.
Nevertheless, Alcatel-Lucent's French unions said they were maintaining their earlier call for a one-day strike on February 15.
"The number of job cuts announced today does not change our plans for a strike," said Jean-Baptiste Triquet, spokesman for the centre-left CFDT union.
Union estimates put the US head count at 24,000 and the western European work force at 29,000.
Some analysts voiced doubts about whether Alcatel-Lucent could keep its pledge to halt the slide in its market share in 2007.