Reported Earlier, 'Nokia Cuts 2,000 Jobs In China, 350 In Europe As Part Of Cost Cuts, Sources Say' - Reuters News

https://www.reuters.com/business/media-telecom/nokia-cuts-2000-jobs-china-350-europe-part-cost-cuts-sources-say-2024-10-17/

Nokia (NOKIA.HE), opens new tab has laid off close to 2,000 people or about a fifth of its employee base across Greater China and plans to cut another 350 jobs across Europe as part of efforts to lower costs, according to two sources familiar with the matter.

A Nokia spokesperson confirmed the company had opened consultations relating to laying off 350 employees in Europe but declined to comment on Greater China.

As of December 2023, Nokia had 10,400 employees in Greater China and 37,400 employees in Europe, according to its annual report, opens new tab.

The company laid out plans last year to cut up to 14,000 jobs to reduce costs and save between 800 million euros ($868 million) and 1.2 billion euros by 2026.

The cuts are part of that plan, the sources said.

China was once the second-largest market for Nokia. But after western countries started banning Huawei (HWT.UL) from 2019, contracts from Chinese telecom operators reduced for both Nokia and Ericsson 

In 2019, about 27% of Nokia's net sales came from Greater China compared with under 6% in the latest quarter.

Nokia still has several offices in Beijing and Shanghai, along with Hong Kong and Taiwan, which are part of the company's Greater China region, from where it services clients such as China Mobile 

On Thursday, Nokia reported a 9% rise in third-quarter operating profit mostly due to cost cuts. But its net sales missed estimates, sending its shares down 4%.

The company has already achieved 500 million euros of gross savings, the spokesperson said.

"We are not doing cost cutting in such a way that we would sacrifice our R&D output," CEO Pekka Lundmark said in a call with reporters. "I am happy with the pace of cost reduction. We are actually a bit ahead of the schedule that we had."

When Nokia announced the job cuts last year, it had total employees of about 86,000 and planned to reduce its base to between 72,000 and 77,000 employees by 2026.