Finnish telecom giant Nokia has announced it will slash up to 14,000 jobs in a major cost-cutting drive.
Nokia, a major provider of 5G equipment that employs 86,000 people, announced the cut as part of a wider restructuring to address a “weaker” market environment, it said in a statement.
The move will lower the company’s headcount to between 72,000 and 77,000 and will help it reduce staffing expenses by 10 to 15 percent, saving at least $421.4 million in 2024 alone.
In the statement, Nokia said the reductions are expected to trim costs by nearly $1.3 billion cumulatively by the end of 2026. The company has said it would “act quickly” to make changes.
CEO Pekka Lundmark said in the statement: “The most difficult business decisions to make are the ones that impact our people. We have immensely talented employees at Nokia and we will support everyone that is affected by this process.”
On the same day as the announcement, Nokia reported worse-than-expected results, with sales in their third quarter falling to 15 percent compared to the same period a year ago.
Mobile network sales fell 19 percent in the third quarter compared to the previous year, the company added.
Swedish rival Ericsson agreed with Nokia’s remarks of a “challenging environment and macroeconomic uncertainty”, warning this week that sales in the second half of 2023 would likely come in lower than usual.
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Still, Nokia has maintained its outlook for 2023, forecasting between $24.4 billion and $25.9 billion in sales for the year.
Lundmark added: “We continue to believe in the mid to long-term attractiveness of our markets.”
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