Nokia to Cut 14,000 Jobs Globally as Part of Cost-Saving Plan
|Nokia to Cut 14,000|
Nokia, the Finnish telecom equipment maker, announced on Friday that it will slash 14,000 jobs globally as part of its plan to reduce its operating expenses and improve its profitability and competitiveness in the market . The job cuts will affect about 10 percent of its workforce and will be implemented over the next three years.
Nokia Faces Challenges in the 5G Market
The decision to restructure its cost base comes amid uncertainty in the market and increased competition from rivals such as Huawei, Ericsson and Samsung in the 5G network segment . Nokia has been struggling to gain a foothold in the 5G market, which is expected to grow rapidly in the coming years as more countries and operators deploy the next-generation wireless technology.
Nokia reported a 19 percent drop in revenue from its mobile networks business in the third quarter of 2023 compared to the same period last year. The decline was mainly due to the slow pace of 5G rollouts in some markets, such as India, where Nokia faced regulatory and operational challenges. The mobile networks business accounted for 24 percent of Nokia's total revenue and saw its operating profit plummet by 64 percent year-on-year.
Nokia Remains Optimistic About Its Future Prospects
Despite the disappointing performance, Nokia maintained its sales outlook for the full year. The company expects to generate revenue of between 23.2 billion euros (about Rp 388.8 trillion) and 24.6 billion euros (about Rp 412.3 trillion) by the end of 2023. Nokia also said it expects to improve its market share in the 5G segment in the medium to long term, as it invests more in research and development and launches new products and services.
"We have very talented employees at Nokia and will support everyone who is affected by this process. Resetting our cost base is a necessary effort to adapt amid market uncertainty, secure profitability and long-term competitiveness," said Pekka Lundmark, President and CEO of Nokia.
"We believe in the medium to long-term attractiveness of our markets," he added.