Nokia Oyj, the telecommunications giant, is reportedly planning to cut as many as 14,000 jobs due to reduced investments in 5G mobile infrastructure by US and European operators. While the Finnish mobile network company has confirmed the job cuts, it hasn’t disclosed the exact number of positions to be eliminated.
This move comes as 5G equipment manufacturers face challenges, with operators in the US and the European Union aiming to reduce capital expenditures and manage their inventories. Nokia’s Swedish rival, Ericsson, recently presented a gloomy outlook, stating that market weakness will continue into the fourth quarter and beyond.
Nokia’s planned job reductions represent a 10% to 15% decrease in personnel expenses and are expected to yield savings of up to €400 million ($421 million) next year and an additional €300 million in 2025.
Nokia also reported weaker-than-expected earnings earlier in the month, with CEO Pekka Lundmark expressing concerns about the company’s performance. The firm had previously downgraded its full-year guidance in July, lowering sales forecasts to a range of €23.2 billion to €24.6 billion and a comparable operating margin of 11.5% to 13%.
Previously, the top end of the operating margin range had been projected at 14%.
