The Finnish telecommunications company seeks to reduce expenses amid declining demand for mobile network equipment
Nokia intends to reduce its workforce by up to 14,000 employees in the next three years in response to weaker-than-expected demand for its mobile network equipment. This Finnish technology firm aims to achieve €1.2 billion in cost savings by the end of 2026, representing a 16% reduction of its 86,000-strong global workforce. The company’s decision to cut jobs came alongside a 70% decline in third-quarter profits, dropping to €133 million (£116 million) from €428 million the previous year. Pekka Lundmark, Nokia’s CEO, expressed the difficulty of such decisions, emphasizing their commitment to supporting affected employees given the company’s highly skilled workforce.
Realigning our cost structure is an essential measure to adapt to market unpredictability and ensure our sustained profitability and competitive edge. We maintain confidence in the opportunities that lie ahead.”
Nokia, headquartered in Espoo, Finland, did not specify the specific locations for the job reductions. The company currently employs approximately 37,700 individuals in Europe, including the UK, where it has offices in Bristol, Cambridge, and Reading. Job cuts are also anticipated to impact its US operations, where it maintains around 10,500 staff across offices in Chicago and Dallas.
Nokia stated that the extent of the cost-cutting initiative would be contingent on product demand. Nevertheless, it anticipates taking swift action to achieve savings of up to €400 million in the next year and an additional €300 million by 2025.
The company also noted that the broader mobile networks market is expected to experience a 9% decline in demand this year, a significant deviation from earlier predictions of a 2% decrease.
This decline in sales was attributed to reduced demand in various countries, notably India, where Nokia indicated that the progress of the country’s 5G deployment had slowed down and was no longer sufficient to compensate for the downturn in North America.
