Nokia announces major job cuts as 5G business slumps

Nokia (HE:) (NYSE:) today announced a major cost-cutting effort with a plan to cut as many as 14,000 jobs, or nearly 16% of it staff, as the company is battling a slump in its 5G business.

In a move that should save ~€400 million (€1 = $1.05) in 2024, and an additional €300 million in 2025, the communications giant intends to bring the headcount down to 72,000-77,000 people from the 86,000 it is employing currently.

Management did not provide specific details on who would be affected by the job cuts, but Nokia’s CEO Pekka Lundmark did note that the company’s focus is on protecting the Research & Development department.

Earlier today, Nokia reported Q3 , missing on both top and bottom lines, with comparable sales drop 20%, and North American sales down 40%.

Lundmark noted that despite strong growth in India, the advancements there are “no[t] anymore able to compensate fully for what we are losing in North America” – the company’s key and most profitable market.

Nokia’s key competitor from Sweden, Ericsson (ST:), also posted weak results earlier this week, saying it expects the weakness to continue in the near term.

Shares of NOK are trading nearly 4% lower following the announcement.