Summary: Telecom gear maker Nokia is planning to cut up to 14,000 jobs, about 16% of its workforce, in order to reduce costs amidst a significant drop in sales and profit. The company aims to lower its cost base by up to 1.2 billion euros by 2026, leading to a reduction in employees from 86,000 to 72,000-77,000. Nokia’s third-quarter sales plummeted 20% to 4.98 billion euros, and its mobile networks business declined 24%. CEO Pekka Lundmark expressed confidence in the company’s long-term prospects and emphasized the importance of investing in improved network capabilities.
Telecom gear manufacturer Nokia has announced plans to cut up to 14,000 jobs globally, which amounts to about 16% of its current workforce. This move comes as the company seeks to reduce costs following a significant decline in its third-quarter sales and profit. Nokia aims to lower its cost base by up to 1.2 billion euros by the end of 2026, which will result in a reduction in employees from 86,000 to a range of 72,000 to 77,000. The plunge in sales and profit was evident in Nokia’s third-quarter financial results. Sales dropped by 20%, amounting to 4.98 billion euros compared to 6.24 billion euros in the same period last year. Additionally, net profit declined from 551 million euros to 299 million euros. The largest revenue-generating unit for Nokia, its mobile networks business, saw a decline of 24% to 2.16 billion euros, largely driven by weakness in the North American market. Operating profit for this division fell by 64%. Nokia’s CEO, Pekka Lundmark, expressed confidence in the company’s future, stating that they believe in the long-term attractiveness of their markets. Lundmark highlighted the significance of investments in networks with improved capabilities, as cloud computing and AI revolutions rely on them. While the timing of market recovery remains uncertain, Nokia is taking decisive action on strategic, operational, and cost levels. Lundmark believes these actions will strengthen the company and deliver value for their shareholders. Nokia is one of the leading suppliers of 5G technology worldwide, alongside Ericsson, Huawei, and Samsung. Earlier this year, Ericsson announced a workforce reduction of 8% as part of their cost reduction efforts.
Tags: Nokia, job cuts, sales decline, profit decline, cost reduction, telecom industry, financial results, market uncertainty, network investments, 5G technology