Nokia has announced it is cutting 10,000 jobs worldwide, with plans to use the savings to help fund its 5G growth.
Nokia is one of the main companies responsible for manufacturing telecommunication equipment. The company is at the center of the transition to 5G, along with Ericsson and Huawei.
Ericsson and Nokia have both benefited from the worldwide challenges Huawei has faced, picking up 5G deployment contracts that would otherwise have gone to the Chinese firm. Unfortunately for Nokia, it has not had quite the success as Ericsson, even leading to considerations of a possible merger or asset sale last year. While there has not been any recent talk of such drastic measures, the company did warn at its last quarterly results that it faced “meaningful headwinds” in 2021.
The company is now announcing plans to cut its worldwide workforce from 90,000 employees to an estimated 80,000 to 85,000 employees over the next 18-24 months.
“Decisions that may have a potential impact on our employees are never taken lightly. Ensuring we have the right setup and capabilities is a necessary step to deliver sustainable long-term performance. My priority is to ensure that everyone impacted is supported through this process,” said Pekka Lundmark, President and CEO.
The cost savings will be used to help fund the company’s R&D, specifically in 5G, cloud and digital infrastructure, as well as future business opportunities.