Nokia reported a 20% drop in third-quarter gross sales resulting from plummeting 5G tools demand
This week, Nokia revealed plans to chop 14,000 jobs — about 16% of its workforce — worldwide as a part of broader price discount efforts, stemming from a poor third quarter.
Particularly, Nokia noticed a 20% drop in third-quarter gross sales to 4.98 billion euros from 6.24 billion in the identical three-month interval final 12 months. The trigger, stated the corporate, is plummeting 5G tools demand, notably in america, the place its gross sales dipped a staggering 45%. In response, Nokia is aiming to chop 800 million euros ($843 billion) to 1.2 billion euros in prices by the tip of 2026. It’s price noting, nevertheless, that Nokia noticed optimistic sale developments in India, the Center East and Africa throughout the quarter.
Different takeaways from the corporate’s Q3 embody an 18% decline in internet gross sales from Community Infrastructure, in addition to 24% decline 12 months over 12 months for IP Networks. Cellular Networks generated revenues of $2,347.3 million, down 24% 12 months over 12 months, and internet gross sales from Cloud and Community Companies had been $807.4 million, down 7% 12 months over 12 months.
Nokia just isn’t alone within the battle, although, as Ericsson in February stated it can even be reducing 8% of its world workforce — roughly 8,500 employees — and on Tuesday, the Swedish firm stated the market uncertainty is predicted to proceed into 2024.
Nokia CEO Pekka Lundmark, nevertheless, stays optimistic that long-term, market will decide up, citing rising applied sciences that may depend on 5G infrastructure. “Cloud computing and AI revolutions is not going to materialize with out vital investments in networks which have vastly improved capabilities,” he stated in a press release.