Nokia to cut 10,000 jobs by the end of 2013

June 14, 2012

Nokia announced Thursday that it plans to cut 10,000 jobs by the end of 2013 and will shut down facilities in Germany, Finland and Canada.

It’s the latest round of cuts for the Finnish smartphone manufacturer, which announced more than 10,000 layoffs last year, the Associated Press noted. The company has struggled to compete against smartphone makers such as Apple, Samsung and HTC, losing its hold as the world’s top mobile phone producer in April. Nokia was still third — behind Apple and Samsung — in tech analysis firm IDC’s May release. The company still managed to grab 8.2 percent of the global market share, but it was a 50 percent decrease from the same period last year.

The company has seen some success since Nokia and Microsoft struck their partnership for smartphones last February and Nokia put its own Symbian system out to pasture. The Nokia Lumia 900 was well-reviewed — particularly because the phone took some colorful design chances — but sales weren’t strong enough to propel Windows Phone and the handset into serious contention with the iPhone or Samsung’s top-flight devices.

Nokia will have to move quickly to transition its phones over to Windows Phone and hope that Microsoft’s operating system will manage to crack Apple and Google’s one-two hold on the smartphone market.

In the meantime, the company said the latest round of layoffs “sharpens” its strategy.

“We are increasing our focus on the products and services that our consumers value most while continuing to invest in the innovation that has always defined Nokia,” said Stephen Elop, Nokia’s president and chief executive in a news release. “However, we must re-shape our operating model and ensure that we create a structure that can support our competitive ambitions.”

The company’s research and development department will be the first hit with layoffs, likely because of the Windows transition. A report from Slashgear said that Nokia’s chief financial officer Rick Simonson said that the company would also consider selling some of its patents, but only “with the right price.”

With its tech pedigree, Nokia has assembled some important patents in its time — something it proved when it hit HTC, Research in Motion and ViewSonic with a series of patent suits in May.

In addition to announcing the layoffs Thursday, Nokia also cut its outlook for the third time in a little over a year, saying that it expects to see larger losses. The smartphone maker also announced it will sell its luxury Vertu brand, while picking up assets from the mobile imaging company Scalado, which helps mobile phone manufacturers make better camera phones.

Related stories:

Nokia files patent suits against HTC, RIM and ViewSonic

Samsung, Apple top Nokia in smartphone shipments

Nokia Lumia 900: The pros and cons

Hayley Tsukayama covers consumer technology for The Washington Post.
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