In a move signalling ongoing challenges in the telecommunications industry, Nokia is cutting nearly 2,000 jobs in Greater China and an additional 350 positions across Europe. The Finland-based tech giant aims to streamline its operations as part of a global cost-cutting strategy initiated last year.

The layoffs are part of Nokia's broader plan to eliminate up to 14,000 positions worldwide by 2026, with the goal of saving between 800 million euros ($868 million) and 1.2 billion euros. While the company has confirmed the job reductions in Europe, details regarding the cuts in China have not been fully disclosed.

Nokia's workforce in Greater China currently stands at around 10,400 employees, while the company employs roughly 37,400 people in Europe. These job cuts reflect the shifting dynamics within the telecommunications sector, as companies like Nokia face increasing pressure from geopolitical tensions, global competition, and changes in market demand.

One of the key challenges for Nokia has been the impact of US sanctions on Chinese firms such as Huawei and ZTE, which has significantly reduced contract opportunities in China. Once a major market for Nokia, China accounted for 27% of the company’s net sales in 2019. However, in the latest quarter, this figure has plummeted to just 6%, underscoring the difficulties Nokia and other international firms face in the region.

Despite a 9% increase in operating profit in the third quarter—largely attributed to ongoing cost-cutting efforts—Nokia’s net sales have fallen short of market expectations. This has prompted further measures to enhance profitability, including workforce reductions.

The decision to cut jobs comes at a time when many major tech companies are restructuring to stay competitive in a rapidly evolving industry. Earlier this week, Meta, the parent company of Facebook, WhatsApp, and Instagram, also announced layoffs, though specific figures were not disclosed. These cuts highlight a broader trend within the tech sector, where companies are recalibrating in response to economic pressures and changing market conditions.

For Nokia, these layoffs are part of a larger effort to focus on future growth areas such as 5G technology and cloud services. By streamlining its workforce and cutting costs, Nokia hopes to strengthen its position in a competitive landscape. However, the road ahead remains uncertain, particularly as the company navigates the complex challenges of operating in markets affected by geopolitical tensions.

As Nokia implements these latest job cuts, it serves as a stark reminder of the ongoing pressures faced by the telecommunications industry. Balancing cost reductions with the need for innovation and market relevance will be critical for Nokia’s future success. The company’s ability to adapt to these changing circumstances will determine its trajectory in the coming years.