Nokia Slashes Nearly 2,000 Jobs in China Amid Challenging Telecom Market
Nokia cuts nearly 2,000 jobs in China as part of a broader cost-reduction program. The company faces challenges in the telecom equipment market, with slow sales and tough competition. Nokia's market share in China is less than 5%, with local rivals like Huawei dominating.
This move comes as the Finnish company faces difficulties in the industry, with slow sales and tough competition, according to a source familiar with the matter.
The job cuts are part of a broader plan announced last year to reduce headcount by as much as 14,000. Nokia currently employs around 10,400 individuals in Greater China as of the end of 2023, as per a company report.
In response to the sluggish market conditions, Nokia and its Nordic competitor Ericsson AB have been implementing cost-cutting measures. Telecom operators have been delaying or scaling back expensive infrastructure upgrades, impacting sales for both companies. In China, where the 5G market is booming, European firms like Nokia are facing tough competition from local giants such as Huawei Technologies Co. and ZTE Corp.
Nokia's market share in China currently stands at less than 5%, highlighting the challenges it faces in the region. The company's business has been further complicated by the deteriorating US-China trade relations, with Chinese operators showing a preference for local equipment over European alternatives. Earlier this year, Nokia reduced its presence in China by selling its stake in a joint venture with Huawei.
While Nokia has not officially commented on the job cuts in China, Reuters previously reported on the matter. Additionally, the company is also reducing its workforce in Europe, with 350 more job cuts announced, including 48 in Finland. Nokia has already eliminated 7,500 positions and managed to cut costs by €500 million (US$543 million) as part of its broader cost-saving program.
With a current workforce of 78,500 employees, Nokia's restructuring efforts are part of its strategy to navigate the challenging market conditions. Ericsson, Nokia's competitor, is also undergoing a significant cost reduction plan, having announced the intention to cut 8,500 jobs last year.
Nokia revealed the job cuts on the same day it reported sales figures for the third quarter that fell short of analyst expectations. The company acknowledged that the recovery in the market is progressing slower than anticipated.
Nokia cuts nearly 2,000 jobs in China as part of a broader cost-reduction program.
The company faces challenges in the telecom equipment market, with slow sales and tough competition.
Nokia's market share in China is less than 5%, with local rivals like Huawei dominating.
Source: YAHOO