Shares of Rolls-Royce PLC (LON: RR.) have plunged 9% today after the firm revealed it suffered a $3 billion loss amid the COVID-19 pandemic.
Rolls-Royce reported that wide-body engine flying hours dropped 50% in the first half of the year. Hence, the firm suffered a “significant” plunge in the demand.
“These are exceptional times. The Covid-19 pandemic has created a historic shock in civil aviation, which will take several years to recover,” said Chief executive Warren East.
In May, Rolls-Royce said it will cut 9,000 jobs from the workforce of 52,000 people. Over 3,000 UK workers will lose jobs, with the largest UK factory in Derby taking the biggest hit.
“We are taking steps to resize our civil aerospace business to adapt to lower medium-term demand from customers and help secure our future. This means we have had to take the very difficult decision to lose people who have helped us become the company we are and who have been proud to work for Rolls-Royce,” added East.
Rolls-Royce has witnessed an uptick in demand in May and June amid an increase in flights in China, Asia Pacific and the Middle East.
Rolls-Royce share price is trading just above 260p as sellers eye a 7-week low at 258p. Shares gained nearly 4% yesterday in the anticipation of a trading update this morning, which obviously disappointed investors.