Nokia announced the plan on October 19. The former mobile king plans to cut between 9,000 and 14,000 jobs due to sluggish sales and falling demand for 5G equipment. The Finnish company currently employs 86,000 people.
The layoffs are part of cost-cutting measures of an additional 400 million euros ($421 million) in 2024 and another 300 million euros in 2025. Nokia wants to reduce costs by up to 1.2 billion euros by 2026.
In a separate statement, CEO Pekka Lundmark said Nokia's third-quarter 2023 revenue was 4.9 billion euros, down 15% from a year ago due to microeconomic challenges and higher interest rates. The company recorded an operating profit of 424 million euros, down 36% in the same period.
According to Mr. Lundmark, re-establishing the cost base is a necessary step to adjust to market fluctuations and ensure long-term profitability and competitiveness.
“The most difficult business decisions are those that impact people. We have talented people at Nokia and will support everyone affected by this,” he added.
Nokia has cut its outlook for the overall mobile network market in 2023, now expecting a 9% decline from 2%. Slow 5G growth in India is no longer offsetting the decline in North America.
(According to Insider)
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