Layoff Update: The sword of layoff hangs over 14,000 employees as the company has planned to reduce the workforce as part of its cost cutting strategy.
Nokia Layoff: Big news has come about the telecom giant Nokia, after which an atmosphere of concern has been created for its employees. Nokia is going to face retrenchment and under this the company is going to fire 14,000 people. Nokia has taken this decision as part of its new cost cutting plan after sales fell by 20 percent in its third quarter results. This decline in sales has been seen due to the slow pace of sales of the company’s 5G equipment.
Nokia took this decision for cost saving
According to a news in Economic Times, Finnish Telecommunications Equipment Group’s Nokia estimates that by the year 2026, it can achieve cost savings of between 800 million to 1.2 billion euros. By this time the company is expected to achieve an operating margin of around 14 percent. Under this, the company aims to reduce the number of employees of the company from 86,000 to between 72,000-77,000.
How were Nokia’s quarterly results?
Nokia has performed less well than expected this time. The company’s operating profit stood at Rs 467 million in the third quarter. Its adjusted earnings have also declined to 5 cents per share whereas analysts had estimated earnings of around 7 cents. Apart from this, the company has also reduced its second quarter sales guidance from 24.6 billion euros to 23.2 billion dollars. At the same time, the company estimated the operating margin to be between 11.5 percent to 13 percent, whereas earlier it was estimated to be 14 percent.
Challenging environment for 5G equipment makers at this time
Due to the decision by the US and European Union to reduce capital expenditure and reduce their inventory, 5G equipment manufacturers are struggling on the revenue and profit front. Nokia has recently displayed its new logo and has revealed its new logo even before the Mobile World Congress to be held in Barcelona today.
