Nokia to Reduce Global Workforce by 9,000 to 14,000 Jobs by 2026 in Cost-Cutting Move Amid Sales Decline
Finnish telecommunications leader Nokia has revealed plans to trim its workforce by 9,000 to 14,000 positions by the end of 2026 as part of a comprehensive cost-cutting strategy. This announcement follows a reported 20% decline in sales during the third quarter, which Nokia attributes to a decrease in demand for 5G equipment, particularly in North American markets.
The company currently employs 86,000 individuals worldwide and has been implementing job cuts since 2015. Nokia aims to achieve cost reductions ranging from €800 million to €1.2 billion (£695 million to £1 billion) by 2026. This initiative is a response to customers tightening their spending in the face of heightened inflation and interest rates.
Nokia’s CEO, Pekka Lundmark, emphasised that advancements in cloud computing and artificial intelligence require substantial network investments. However, given the unpredictable timing of market recovery, Nokia has decided to take proactive measures to secure its financial stability. The company intends to reduce costs by €400 million in 2024 and by an additional €300 million in 2025.
Lundmark expressed optimism about an eventual recovery in the network business in the current quarter, despite the ongoing market uncertainty. Specific details about the job cuts, including their locations and potential impact on employees in the UK, were not disclosed. Nokia characterised these cuts as a challenging but necessary step to adapt to market fluctuations and safeguard long-term profitability and competitiveness. A spokesperson assured that affected employees would receive support, and the final decisions regarding the timing and scope of the job reductions would be made after careful consideration and contingent upon the evolution of market demand.
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