Nokia today announced a new operating model and new leadership team as total sales dropped 7 percent in Q3 2020 to EUR 5.3 billion.
Nokia sales fell 7 percent in Q3 2020 to EUR 5.3 billion, compared to EUR 5.7bn in Q3 2019 — primarily due to services within Mobile Access. The services-related declines in Q3 2020 were primarily driven by lower levels of network deployment services.

“Industrial automation and digitalization are increasing demand for high-performance networks, with a trend towards open interfaces, virtualization, and cloud native software. This will revolutionize how we design, deploy, manage and sell our products and solutions,” said Pekka Lundmark, president and CEO of Nokia.

Nokia’s strategy review

Nokia’s strategy review has four major components.

First, technology leadership will be the top priority.

Second, company’s current customer base, consisting of telco operators and enterprises, will bring value.

Third, there is a longer-term opportunity to move into higher-value network-as-a-service business models.

Fourth, end-to-end as a core strategic idea will be replaced with a more focused approach. Each of the company’s new business groups will have a distinct role in the strategy.

Nokia will have four P&L-responsible business groups structured around customer offerings, with ownership for becoming one of the market leaders in their respective sector.

Nokia’s new business groups

Mobile Networks, which will include mobile network products, network deployment and technical support services, and related network management. It will target leadership in key technologies such as 5G, ORAN and vRAN.

Tommi Uitto will be the president of Mobile Networks group that clocked approximately €10 billion in sales in the last four quarters.

IP and Fixed Networks, which will include IP Routing, Optical Networks and Fixed Networks, as well as Alcatel Submarine Networks business.

Federico Guillen will be the president of IP and Fixed Networks that clocked approximately €7 billion in sales in the last four quarters.

Cloud and Network Services, which will include the existing Nokia Software business (excluding Mobile Networks network management), Nokia’s enterprise solutions, core network solutions including both voice and packet core, and managed and advanced services from its current Global Services unit.

Raghav Sahgal will be the president of Cloud and Network Services business that clocked approximately €3 billion in sales in the last four quarters.

Jenni Lukander will be the president of Nokia Technologies that clocked approximately €1.4 billion in sales in the last four quarters.

Nokia will have a Customer Experience organization that will provide a common interface with customers across all business groups. This unit will include Nokia’s customer teams, region and country management, as well as marketing. Ricky Corker will lead Nokia’s Customer Experience organization.

Additionally, there will be four corporate functions:

Chief Financial Officer Marco Wiren will head finance division.

Chief Legal Officer Nassib Abou-Khalil will head Legal and Compliance division.

Chief People Officer Stephanie Werner-Dietz will head people management.

Nokia will name a new person for Strategy and Technology division.