Nokia Siemens Networks To Slash 15% of Its Workforce; Shares Decline

Friday morning Nokia Siemens Networks, equally co-owned by Nokia Corp. and Siemens AG, said it will slash 9,000 jobs globally, sending shares of both companies lower in pre-market trading. The networking giant is hoping to improve its competitive position through cost cutting synergies of €1.5 billion annually by 2010. The job cuts amount to roughly 15% of Nokia Siemens 60,000 strong work force, at the high end of its 10%-15% projection last June. Nokia Siemens CEO Simon Beresford-Wylie called it "a necessary step to build a Nokia Siemens Networks able to compete now and in the future." The cuts will occur between now and 2010, with the most cuts coming in Germany (2,800-2,900 employees) and Finland (1,500-1,700), where Siemens and Nokia are headquartered, respectively. In pre-market action (8:00 AM), ADR shares of Nokia were down $0.39, or 1.52%, to $25.25, while Siemens ADR shares were lower by $1.47, or 1.19%, to $122.08.

Sources: Wall Street Journal, MarketWatch, AP
Commentary: Apple's iPhone and The Future of Nokia • Profiting From the Global Cellular Wireless Boom • Siemens' CEO Departure Should Worry Investors - Barron's
Stocks/ETFs to watch: Nokia (NOK), Siemens AG (SI). Competitors: Ericsson (ERIC), Cisco Systems (CSCO), Alcatel-Lucent (ALU), Motorola (MOT).
ETFs: iShares Goldman Sachs Network Index Fund (IGN), PowerShares Dynamic Networking (PXQ)

Seeking Alpha's news briefs are combined into a pre-market summary called Wall Street Breakfast. Get Wall Street Breakfast by email -- it's free and takes only seconds to sign up.