Nokia has announced that it will cut up to 14,000 jobs over the next three years as part of efforts to cut costs by €1.2bn by the end of 2026. The company aims to reduce its workforce from 86,000 to about 72,000. The cuts were announced as the company revealed a 70% drop in third-quarter profits, which fell to €133m (£116m) compared with €428m a year earlier. The Finnish technology company said the plans to cut 16% of its global workforce were part of efforts to adjust to market uncertainty and secure long-term profitability and competitiveness.
Nokia’s CEO, Pekka Lundmark, said that “resetting the cost base is a necessary step to adjust to market uncertainty and to secure our long-term profitability and competitiveness. We remain confident about opportunities ahead of us”.
The job cuts come after Nokia’s third-quarter sales dropped by 20% due to slowing sales of 5G equipment in markets such as North America. The company expects to act quickly in order to save as much as €400m next year and another €300m in 2025. Nokia did not detail where the job cuts would fall but said that demand across the wider mobile networks market was likely to drop 9% overall this year.
The announcement of job cuts is a significant development for Nokia, which has been struggling with declining sales and increased competition in recent years. The company has been working to restructure its business and focus on new growth areas such as 5G technology. However, the latest results suggest that Nokia still has a long way to go before it can return to sustained growth and profitability.
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