Tag: Job Cuts

Highlights Nokia announces plan to cut up to 14,000 jobs due to a 20% decline in third-quarter sales. Aimed at achieving long-term savings of up to 1.2 billion euros by 2026. Mobile network sales see a 19 percent drop, reflective of a global 5G slowdown. Nokia is embroiled in legal battles with Oppo, OnePlus, and Vivo, adding to the company's woes. Facing a significant sales slump of 20 percent in the third quarter, largely attributed to sluggish 5G equipment sales, Nokia, the Finnish telecommunications behemoth, has initiated a dramatic cost-cutting plan. The decision to slash up to 14,000 jobs arrives as the company confronts multiple challenges, particularly in vital markets like North America and India. Sales and Targets The company aims for savings between €800 million euros (about Rs 70,40,00,00,000) and €1.2 billion by the year 2026. The ambition is clear: Nokia strives to achieve a long-term target of a comparable operating margin of at least 14 percent by 2026. These initiatives will result in Nokia's current workforce of 86,000 being whittled down to a leaner 72,000-77,000. Such a restructuring paints a picture of a company aggressively recalibrating its strategies to meet long-term financial goals. Nokia: Sales and Targets Underwhelming Performance To put these measures into context, Nokia witnessed a steep drop in net sales in the third quarter, falling from 6.24 billion euros to 4.98 billion euros, missing the anticipated 5.67 billion euros as per an LSEG poll. The underperformance was largely due to mobile network sales, which experienced a 19 percent drop in the same quarter. This reflects a broader slowdown in 5G deployment, evident in markets like India. Nokia's Swedish competitor, Ericsson, shared similar concerns, anticipating a dip in sales for the second half of 2023 due to an uncertain economic landscape. Legal Battles Compounding Nokia's troubles is an ongoing patent dispute with Oppo, which has led to delays in the release of the OnePlus Open. The Finnish company is not limiting its legal pursuits to Oppo but is embroiled in lawsuits against Vivo as well in Europe. FAQs What is the primary reason for Nokia's job cuts? Nokia is slashing jobs primarily due to a significant slump in third-quarter sales, largely attributed to weak 5G equipment sales. How many jobs will Nokia cut? The company plans to reduce its workforce by up to 14,000, aiming for a streamlined employee base of around 72,000-77,000. What are Nokia's long-term financial goals? Nokia aims to save between 800 million euros to 1.2 billion euros by 2026 and targets an operating margin of at least 14%. Is Nokia facing any legal issues? Yes, Nokia is currently in a patent dispute with Oppo and is also pursuing legal action against OnePlus and vivo in Europe.

Tag: Job Cuts

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