Nokia (NOK) Plans To Trim 353 Jobs In Finland To Cut Costs
Zacks Investment Research | Apr 01, 2018 11:08PM ET
Nokia (HE:NOKIA) Corporation (NYSE:NOK) has decided to cut 353 jobs in its home market Finland this year due to a weak global network market. The strategic step is part of the company’s global cost-savings initiative. The retrenchment tally has, however, decreased from the company's initial plan to reduce up to 425 jobs.
Of 353 jobs scheduled to be trimmed, 283 will be cut from the company's mainstay networks business and 70 from the Technologies unit, which includes its licensing operations and digital health business. The company plans to save 1.2 billion euros (or $1.5 billion) annually following its 2016 acquisition of Alcatel-Lucent (PA:ALUA), and a weak network equipment market.
The company had reported strong fourth-quarter 2017 results, supported by growth and solid performance in Networks business and record net sales in Nokia Technologies. It anticipates non-IFRS earnings of 28 to 33 cents per share for full-year 2018.
Nokia has progressed well in its mobile product portfolio since the third quarter. It is now well-positioned for the upcoming transition to 5G. The 4G/LTE software release was of the highest quality. AirScale 5G-ready base stations are shipping in volume and delivering excellent results.
Nokia is making steady progress in the execution of product migrations for key customers. Also, the company launched ReefShark, a new chipset family for mobile products and 5G Future X architecture. Both of these are expected to provide strong competitive advantage for Nokia.
Nokia's primary networks division is likely to see some improvement this year. The rate of decline of net sales at the unit is expected to reduce in the current year due to early signs of improved conditions in North America. The division is expected to grow faster than the primary addressable market over the long term. Further, the acquisition of Unium, completed in March 2018, is expected to have positive impact on Nokia’s results.
Over the last three months, Nokia’s shares have significantly outperformed the Zacks Investment Research
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