STOCKHOLM (Reuters) – Finnish telecom gear group Nokia on Thursday reported a 20% fall in third-quarter sales due to slowing sales of 5G equipment in markets such as North America, and announced a new cost savings plan.
The company’s comparable net sales dropped to 4.98 billion euros ($5.25 billion), a decrease from last year’s 6.24 billion euros, falling short of the estimated 5.67 billion euros, according to a LSEG poll.
While Nokia has been a key player in the 5G market, its sales have been hit by slower sales in North America, among other regions. The decline in sales of 5G equipment has led to the company’s decision to implement a new cost savings plan.
The overall decrease in sales is concerning for Nokia, as the global demand for 5G technology continues to grow. However, factors such as delays in network investments and geopolitical uncertainties have impacted the company’s sales.
Nokia’s rival companies have also faced challenges in the 5G market, with Huawei facing restrictions from the United States and Ericsson experiencing delays in orders. This has created a challenging business environment for all players in the industry.
The telecom gear group’s new cost savings plan aims to address the current challenges and improve its financial performance. Nokia plans to cut costs across various departments and streamline its operations to enhance efficiency and reduce expenses.
The company’s CEO, Pekka Lundmark, expressed optimism for Nokia’s future despite the decrease in sales. He emphasized the importance of addressing the current challenges and adapting to market conditions to secure long-term success.
Nokia’s focus on cost savings reflects a strategy employed by many companies during challenging times. By cutting costs and improving efficiency, the company aims to navigate the current uncertainties in the market and position itself for future growth.
The decline in third-quarter sales highlights the need for Nokia to assess its strategies and adapt to changing market dynamics. The implementation of the cost savings plan is a step towards addressing the current challenges and ensuring a stronger future for the company.
Despite the tough market conditions, Nokia remains committed to delivering high-quality telecom equipment and contributing to the advancement of global connectivity.
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(Reporting by Supantha Mukherjee in Stockholm, editing by Terje Solsvik)
