The savings will allow Nokia to invest in research and development and future capabilities.
Finnish technology giant Nokia is planning to cut as many as 10,000 jobs over an 18- to 24- month period.
In Finland, the job negotiations concern 314 employees, but the company is not yet able to give an estimate of how many will possibly lose their jobs.
The job reductions, according to the corporation’s press release, are expected to lower the company’s cost base by approximately €600 million by the end of 2023.
The savings will allow Nokia to invest in research and development and future capabilities including 5G, cloud and digital infrastructure, as well as other areas that will benefit Nokia in the long-term.
“Nokia now has four fully accountable business groups. Each of them has identified a clear path to sustainable, profitable growth and they are resetting their cost bases to invest in their future,” said Pekka Lundmark, president and CEO of Nokia.
“Each business group will aim for technology leadership. In those areas where we choose to compete, we will play to win. We are therefore enhancing product quality and cost competitiveness, and investing in the right skills and capabilities,” Lundmark continued.
By cutting jobs, Nokia expects savings of approximately 50% in 2021, savings of 15% in the following year and about 35% in 2023.
The job negotiations are expected to result in an 80,000–85,000 employee organization, instead of the approximately 90,000 employees Nokia has today.