Nokia To Cut 14,000 Jobs
Phone maker Nokia is set to cut up to 14,000 jobs in order to deal with a sharp downturn in operator spending.
This is being done to reduce costs, following a 20% drop in 3rd quarter sales on weaker demand for 5G.
Chief executive Pekka Lundmark said “The market situation is really challenging, and it is witnessed by the fact that in our most important market, which is the North American market, our net sales are down 40 percent in Q3”
The company said the workforce would be shortened to between 72,000 and 77,000 by 2026, from 86,000. It all depends on how the market demand evolves.
It is targeting to save between 800 million euros (approx. $1.3 billion AUD), and 1.2 billion euros (approx. $2 billion AUD) by 2026.
Pekka Lundmark didn’t reveal any more details, advising the company must consult with employee representatives first. He did say they wanted to protect research and development.
Nokia now focuses on telecoms equipment after being a leader in mobile handsets, and expects at least 400 million euros of savings in 2024, and a further 300 million euros in 2025.
“We continue to believe in the mid-to-long-term market, but we are not going to sit and wait and pray that the market will recover anytime soon,” Lundmark continued.
“We simply don’t know when it will recover.”