Maersk announces workforce reduction, profits decline in Q3

Danish shipping giant Maersk has revealed its decision to cut 3,500 jobs in response to a significant drop in net profit and revenue during the third quarter. Maersk’s net profit plummeted to $521 million, marking a considerable decrease from $8.9 billion in the same period the previous year.

The company attributed this decline to the challenging market conditions and a sharp fall in freight rates, signaling what its CEO, Vincent Clerc, referred to as a “new normal” for the industry. Furthermore, Maersk had already initiated cost-cutting measures that led to a reduction in staff levels from 110,000 at the beginning of 2023 to approximately 103,500.

To further align with this new economic landscape, Maersk announced plans to decrease its workforce by an additional 3,500 positions. Of these, up to 2,500 job cuts will take place in the coming months, with the remaining reductions extending into 2024. This strategic move is aimed at bringing the global workforce to below 100,000 positions.

In addition to the workforce reduction, the company reported a decline in revenue, with Q3 earnings amounting to $12.1 billion, compared to $22.8 billion in the same period the previous year. This decline, particularly in Maersk’s shipping business, has resulted in ocean results reaching break-even levels, primarily due to persistently challenging market conditions and substantially lower freight rates compared to the abnormally high rates experienced in 2022.