Nokia accelerates on 5G, for which it invests 600 million euros between now and 2023, but in return it will cut by that date up to 10.000 employees worldwide, i.e. about 11% of its current workforce. The Finnish tech company therefore decides to give absolute priority to the race for 5G, for which he is a candidate to be the European champion, with the support also of the United States which does not currently have an operator capable of stemming the expansion of the Chinese Huawei, which however according to Washington (also with the new course of Joe Biden) must be absolutely prevented for reasons of cybersecurity and technological espionage.
To boost research, Nokia will therefore save on personnel, which globally will go from the current 90.000 units to around 80.000: "The decision was not taken lightly - explained CEO Pekka Lundmark -, but it was necessary to have a good organization and good ability to grow at a time that demands the best possible long-term performance from us. In any case, the priority is to protect and safeguard all the people who will be removed during this phase".
The operation, as mentioned, will allow the Finnish giant to allocate 600-700 million to research, half of which already in 2021. This is why Nokia has confirmed its financial estimates for the current year, i.e. a turnover included in the range between 20,6 and 21,8 billion euros, and an operating margin between 7 and 10%. An important Investor Day is also scheduled for Thursday 18 March, during which the Scandinavian company will clarify whether it will also able to return to distribute dividends, after it had given up doing so in 2019 due to Covid. The choice cost a dramatic collapse of the stock on the Stock Exchange: -30%, the worst loss in 30 years.
The race for 5G is heating up and Nokia does not want to miss the train: so far, the Swedish company has mainly taken advantage of the international sanctions against Huawei Ericsson, which in 2020 increased the sales of 5G devices by 7% and which by now holds 35% of the European market, versus 25% for Nokia and 20% for Huawei.
