Lego to cut 1,400 staff as decade-long sales boom ends

 Lego said it would lay off 8 percent of its staff and revamp its business after reporting its first fall in sales in more than a decade on Tuesday.

The Danish toymaker announced a 5-percent decline in mid-year revenue a month after abruptly removing its chief executive, suggesting it is facing its biggest test since flirting with bankruptcy in the early 2000s.

Lego said it could not promise a return to growth in the next two years, a jolting acknowledgement for a group widely admired for embracing the digital era and tying up lucrative franchises from Harry Potter to Minecraft.

“We have now pressed the reset-button for the entire group,” executive chairman Jorgen Vig Knudstorp said, acknowledging the business had grown too complicated.

He would seek a return to a leaner and more efficient organization to respond to “losing momentum ... which we think could ultimately lead to stagnation or even decline.”

Lego said revenues had disappointed in its core markets of the United States and Europe, after a decade of double-digit growth and launches spanning Lego sets, video games, movie franchises, robotics and smartphone applications. reuters.com