Nokia Unveils Cost Reduction Program, Plans Up To 14,000 Job Cuts; Backs Long-term View

(RTTNews) - Finnish telecom major Nokia Corp. (NOK) on Thursday announced strategic and operational changes to its business. The company announced a cost reduction program, expecting to cut up to 14,000 jobs, with a view to enable it to navigate the current market uncertainty.

The company also reiterated its long-term comparable operating margin target of at least 14 percent to be delivered by 2026.

The new cost reduction program is designed to lower cost base by 800 million euros to 1.20 billion euros on a gross basis over a three year period. This represents a 10 percent to 15 percent reduction in personnel expenses. The cost savings are expected to primarily be achieved in Mobile Networks, Cloud and Network Services and Nokia's corporate functions.

Nokia sees at least 400 million euros of in-year savings in 2024 and a further 300 million euros in 2025. The program is expected to lead to a 72, 000 to 77, 000 employee organization compared to the 86, 000 employees Nokia has at present.

The company said the exact scale of the program will depend on the evolution of end market demand. The program is expected to deliver savings on a net basis but the magnitude will depend on inflation.