Nokia Layoffs: Firm To Fire 2,000 Employee In China, 350 In Europe, Says Report

Nokia Layoffs: The report states that a Nokia spokesperson confirmed that the firm has initiated consultations regarding the layoff of 350 employees in Europe but declined to comment on Greater China

Nokia is reportedly laying off nearly 2,000 employees, accounting for about 20 per cent of its workforce in Greater China. It plans to cut an additional 350 jobs across Europe as part of its cost-reduction strategy, according to a Reuters report citing two sources familiar with the situation.

The report states that a Nokia spokesperson confirmed that the company has initiated consultations regarding the layoff of 350 employees in Europe but declined to comment on the situation in Greater China.

According to its annual report, Nokia had 10,400 employees in Greater China and 37,400 in Europe as of December 2023. Last year, the company announced plans to cut up to 14,000 jobs as part of a strategy to reduce costs, aiming to save between 800 million euros ($868 million) and 1.2 billion euros by 2026. The cuts are part of that plan, the sources said in the report.

China was once Nokia's second-largest market. However, after western countries banned Huawei in 2019, contracts from Chinese telecom operators significantly declined for both Nokia and Ericsson.

In 2019, approximately 27 per cent of Nokia's net sales came from Greater China, but that figure dropped to under 6 per cent in the latest quarter.

Despite this downturn, Nokia maintains several offices in Beijing and Shanghai, as well as in Hong Kong and Taiwan, which are all part of its Greater China region. From these locations, the company continues to service clients such as China Mobile, as per the report.

On Thursday, Nokia reported a 9 per cent increase in its third-quarter operating profit, primarily due to cost-cutting measures. However, the company's net sales fell short of expectations, leading to a 4 per cent decline in its shares.

According to a spokesperson, Nokia has already achieved 500 million euros in gross savings.

CEO Pekka Lundmark emphasised during a call with reporters that the company is not cutting costs at the expense of its R&D output. "I am happy with the pace of cost reduction. We are actually a bit ahead of the schedule that we had," he noted.

When Nokia announced its job cuts last year, it had approximately 86,000 employees and aimed to reduce its workforce to between 72,000 and 77,000 by 2026. Currently, the company employs just over 78,500 people, according to the spokesperson.