Nokia announces 10,000 job cuts, management changes & Vertu sale

Nokia just dropped yet another bomb today as it announced plans to cut off 10,000 jobs by the end of 2013 as well as sweeping changes to its senior leadership. The company also painted a dismal picture for its second quarter results and expects it to continue through the third quarter. It also announced it will be selling its Vertu luxury phone division to EQT VI, a European private equity firm.
“We must re-shape our operating model and ensure that we create a structure that can support our competitive ambitions,” Nokia CEO, Stephen Elop, said. Read on for more.
Nokia will be shutting down its facilities in Ulm in Germany, Burnaby in Canada as well as its manufacturing plant in Salo, Finland. However, R&D work will continue to happen in Salo.
Nokia also announced sweeping changes in its top leadership team. It has appointed Juha Putkiranta as executive vice president of Operations; Timo Toikkanen as executive vice president of Mobile Phones; Chris Weber as executive vice president of Sales and Marketing; Tuula Rytila as senior vice president of Marketing and Chief Marketing Officer; and Susan Sheehan as senior vice president of Communications.
Jerri DeVard steps down as chief marketing officer; Mary McDowell steps down as executive vice president of Mobile Phones; and Niklas Savander steps down as executive vice president of Markets. DeVard, McDowell and Savander will all continue in advisory roles through the transition of their roles; however, they step down from the Nokia Leadership Team effective June 30, 2012.
Coming to its second quarter results, Nokia is expecting worse than expected results, especially for its smart devices business indicating its Lumia series is not doing as well as it hoped. “During the second quarter 2012, competitive industry dynamics are negatively affecting the Smart Devices business unit to a somewhat greater extent than previously expected. Furthermore, while visibility remains limited, Nokia expects competitive industry dynamics to continue to negatively impact Devices & Services in the third quarter 2012,” the company stated in a press release issued today.

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