Nokia on Thursday said it is planning to lay off 16 per cent of its global workforce, which would means that 14,000 of its employees will lose their jobs. The move is part of a cost-cutting measure after the Finnish firm's third-quarter sales and profit plummeted.
The telecom equipment maker said the planned measures are aimed at reducing its cost base by €800 million to €1.2 billion by 2026 end, adding that it will “increase operational efficiency to navigate the current market uncertainty."
The wireless and fixed-network equipment provider's third-quarter sales dropped 20 per cent from €6.24 billion to €4.98 billion, compared to the same period in 2022, reported AP. Comparable net profit also dipped from €551 million to €299 million during the same three-month period, the agency added.
“We continue to believe in the mid- to long-term attractiveness of our markets,” Nokia CEO Pekka Lundmark said in a statement. “Cloud computing and AI revolutions will not materialize without significant investments in networks that have vastly improved capabilities.”
“While it's unclear when the market will improve, Nokia isn't standing still but taking decisive action on three levels: strategic, operational and cost,” Lundmark said. “I believe these actions will make us stronger and deliver significant value for our shareholders.”
Earlier this year, Sweden's Ericsson, another major supplier of 5G, said it was reducing eight per cent of its workforce to cut costs.
Earlier this week, Ford said it is laying off about 700 workers from a Detroit plant that builds F-150 Lightning because of supply chain constraints and sales dropping 45 per cent. On Monday, LinkedIn fired over 500 employees in its second round of layoffs this year.
In the third quarter, Citigroup Inc also laid off 2,000 employees, bringing the total workforce reduction in 2023 to 7,000 jobs, according to Bloomberg.
-- with agency inputs
