Layoffs wave 2023: Nokia to cut 14,000 jobs after profits plunge

Nokia Layoffs 2023: Finnish telecommunications equipment group Nokia plans to cut up to 14,000 jobs as part of a cost-saving initiative following a 20% drop in third-quarter sales, attributed to slowing 5G equipment sales in markets like the U.S.

Nokia's Ambitious Cost-Saving Goals

The company aims to achieve cost savings between 800 million euros and 1.2 billion euros by 2026, with a target of attaining an operating margin of at least 14% by that year.

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Nokia Layoffs 2023

Nokia's restructuring plan is expected to reduce its workforce from 86,000 to 72,000-77,000 employees. In the third quarter, the company posted weaker-than-expected earnings, with an operating profit of $467 million and adjusted earnings per share at 5 cents, falling short of the estimated 7 cents.

After revising its full-year sales guidance, Nokia now anticipates sales in the range of 23.2 billion euros to 24.6 billion euros, with a comparable operating margin between 11.5% and 13%. Makers of 5G equipment are grappling with reduced investments by U.S. and EU operators.

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Industry-Wide Struggles

Nokia plans to streamline its corporate center to offer strategic oversight while maintaining R&D spending and providing more autonomy to its business units.

In a similar industry challenge, Swedish competitor Ericsson AB reported a drop in shares and projected continued market weakness into the fourth quarter and beyond. This is due to reduced investments in 5G infrastructure by U.S. and European operators.