In a press release, Nokia, a Finnish network infrastructure company, vaguely stated that they plan on laying off 5,000 to 10,000 jobs by saying they will “reset its cost base to invest in future capabilities.”
Apparently, this will allow the company to make EUR600 million in savings by 2023, which they will then be used to invest in research and development.
As of writing, Nokia employs 90,000 people. The trimming process of up to 10,000 people will happen in the next 12 to 24 months.
The associated cost for this move will be about EUR600 to EUR700 million. The 50% is expected in 2021, 15% is expected in 2022, and about 35% is expected in 2023.
Also mentioned in the press release are the EUR500 million cash outflows from the previous restructuring period.
The savings Nokia will make from the decreased workforce will offset its increased spending for research and development, cost-related to salary inflation and future capabilities.
Nokia’s Mobile Networks and Cloud and Network Services should see the most drastic changes after the restructuring.
A few years ago, Nokia made the local news after it closed its R&D facility in the Philippines.
Meanwhile, the brand’s most popular business, Nokia Mobile, should remain the same, as HMD Global primarily handles it.