- Nokia confirms that it will be laying off 14 000 employees in the coming weeks.
- The upcoming layoffs represent 16 percent of the company’s workforce.
- The reduction comes after Nokia’s profits fell during its third quarter.
At the end of last year, the impact of the Tech Winter was in full effect, as many companies announced mass layoffs as the result of poor performance or equally poor predictions made during the pandemic.
Now Tech Winter may be readying to hit again, as a number of organisations have begun to announce layoffs, including Nokia this week, which says it will have to let go of 14 000 employees in the coming weeks.
Per CNBC, the company said it needs to reduce its cost base and drive more operational efficiencies in order to, “address the challenging market environment.”
Nokia tells the news outlet that it aims to reduce its cost base between €800 million to €1.2 billion by the end of 2026, with the aforementioned job cuts decreasing the size of its workforce by roughly 16 percent. To that end, its current estimated workforce of 86 000 will be reduced to a range of 77 000 to 72 000.
As for why the job cuts are now on the table, Nokia saw its third quarter net sales decline by 20 percent year-on-year to €4.98 billion, with its profits falling by an even larger 69 percent over the same period.
With the global economic downturn seeing key mobile operators and networks spending less than before. Nokia specifically told CNBC that 5G deployments in North America and India have slowed down considerably compared to the previous year.
Either way, this latest announcement from the company comes as quite the shock, especially as Nokia recently rebranded and laid out its intent to diversify within the telecommunications space.