ESPOO, Finland (
Nokia Siemens Networks
to cut 17,000 jobs, 23% of its global workforce, on Wednesday, although no decisions have been made yet on the future of the company's almost 4,000 U.S. employees.
The joint venture of Finland's
, employs 3,850 people in America.
Nokia Siemens Networks will cut 23% of its global workforce.
Speaking during a conference call, Nokia Siemens Networks CEO Rajeev Suri opted not to provide country-specific breakdowns on the cuts. "We simply cannot do so until we complete country-level plans and reach the appropriate moment in local consultation processes," he said.
"While we plan to reduce our workforce significantly, we will not make simple across the board reductions, that's not the plan," added Suri. "For those areas that are not core to us, we will invest less in the future."
Suri also said that some non-core businesses may be divested, pointing to the recent sale of Nokia Siemens Networks' microwave telecom business to
The company's restructuring effort aims to slash its costs by ¿1 billion ($1.3 billion) by the end of 2013. Suri explained that, in addition to job cuts, real estate, information technology, and the joint venture's organizational structure will be targeted.
"We're far from satisfied with our profitability," he explained. "Telecommunications infrastructure is no longer an industry that offers the jaw dropping growth rates and high gross margins of the turn of the century."
The CEO nonetheless vowed to boost the company's performance by focusing on growth areas such as mobile broadband and services.
Investors in parent company Nokia, however, were unimpressed by the restructuring news. The company's shares dipped 13 cents, or 2.34%, to $5.43 on Wednesday, slightly outpacing the broader retreat in tech stocks that saw the Nasdaq fall 2.03%.
Recent months have seen a
in the joint venture space, as companies react to a volatile economic climate.
In October, for example,
bought its mobile handset venture with
grabbed a jet engine-making partnership with
Earlier this month, Chinese tech giant
plans to spend $530 million to acquire
49% stake in a joint venture the two companies established in 2008.
Written by James Rogers in New York
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