Nokia on Thursday said it would cut up to 14,000 jobs as part of a cost reduction plan following a plunge in third-quarter earnings.
The Finnish telecommunications giant said that it will reduce its cost base and increase operation efficiency to “address the challenging market environment.”
It is targeting to lower its cost base on a gross basis from 2023 by between 800 million euros ($842.5 billion) and 1.2 billion euros by the end of 2026.
This will reduce the number of employees currently from 86,000 to between 72,000 and 77,000.
The substantial layoffs come after Nokia reported third-quarter net sales declined 20% year-on-year to 4.98 billion euros. Profit over the period plunged by 69% year-on-year to 133 million euros.
One of the world’s largest telecommunications equipment makers, Nokia has been facing headwinds from a slowing global economy and from infrastructure spending reductions made by mobile operators.
Sales from Nokia’s biggest unit by revenue, its mobile networks business, declined 24% year-on-year to 2.16 billion euros, with operating profit for the division diving 64% year-on-year.
Nokia said this was mainly driven by declines in North America. The company also described sale volumes in India as “moderated,” as 5G deployments “normalize.”
5G is next-generation mobile internet that promises faster speeds.