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Cordless phone from Gigaset: Many people associate the company with such devices

Photo: Jörg Carstensen / dpa

The landline phone and smartphone manufacturer Gigaset says it is insolvent. The Bocholt-based company with 850 employees announced on Tuesday that it would file for insolvency for its listed parent company Gigaset AG. The operating subsidiary Gigaset Communications GmbH is to be restructured on its own.

The main reasons for this are an unexpected and significant decline in sales in the second half of 2023 as well as a business development that was significantly below planned, the company announced. In addition, there is persistently weak demand for Gigaset products and a reluctance to buy in Germany and Europe.

The overarching goal of the insolvency proceedings in self-administration for Gigaset Communications GmbH is a sustainable restructuring of the operating business, it says. The company will continue its development, production and sales activities for the so-called DECT cordless telephones "unchanged".

Earnings are expected to be significantly lower than in the previous year

Magnus Ekerot, CEO of Bosch, who arrived at the beginning of the year, blames the former management for the imbalance: "Over the past few years, Gigaset has not been able to compensate for the decline in its core business with DECT cordless phones by setting the right course in the new divisions." This "unhealthy and one-sided business orientation" had contributed to the predicament.

Gigaset claims to be Europe's market leader for DECT cordless phones. The company's business activities with 175 years of history also include Android-based smartphones, cloud-based smart home offerings and business telephony solutions.

Gigaset has been majority-owned by Chinese investor Sutong Pan since 2014 through its investment firm Goldin Financial Holdings. According to the data service provider LSEG, he most recently held 72 percent of the shares. On the stock exchange, the company was last worth 42 million euros. The former Siemens subsidiary was sold to a financial investor in 2008.

Two weeks ago, Gigaset revised its forecasts significantly downwards. Accordingly, revenue and operating earnings (Ebitda) in the current year should be significantly below the previous year's level, contrary to expectations. In 2022, Gigaset generated revenue of €241.3 million and an Ebitda of €17.9 million.