French telecoms equipment maker, Alcatel-Lucent has announced that it will cut around 5,000 jobs around the world as part of its plans to generate 1.25 billion euros in revenues by the end of next year.

The company has reported a net loss of 254 million euros during the second quarter of the year. The total turnover of the company fell 7.1 per cent to 3.5 billion euros in the quarter compared to the same quarter in the previous year.

Alcatel chief executive Ben Verwaayen said that the company has to take firm actions at this time. H said that the steps would include reducing the company's workforce and exiting certain non-profitable contracts. Mr. Verwaayen believes that the reduction of 6.4 percent in the group's workforce would help the company deal with the problems of falling share prices and low liquidity.

The company has been trying to reduce its costs since years in order to better compete with the likes of China's Huawei Technologies and Sweden's Ericsson. Alcatel-Lucent currently employs a total of about 78,000 people around the world.

The shares of the telecom giant were the worst performing on the CAC 40 index of blue chip companies in France. The market value of the firm is about 1.9 billion euros.