Ericsson AB is preparing to cut about 1,600 jobs as it pushes ahead with efforts to reduce operational costs.
The Swedish network equipment supplier said on Thursday that the cuts will affect its workforce in Sweden and that it has entered negotiations with unions.
The decision adds to a wider cost-cutting drive at Ericsson, as the company works to protect margins in a telecom equipment market that has stayed weak for longer than expected.
It also reflects how network suppliers are still adjusting to slower spending cycles from mobile operators.
Swedish workforce cuts move to centre stage
Ericsson confirmed the planned job reductions will impact employees in Sweden, marking a major cost action within its home market.
The company said the process has moved into discussions with unions, which is a key step in restructuring plans that affect Swedish staff.
For Ericsson, Sweden remains central to its operations, making the planned 1,600 job cuts a notable part of its ongoing effort to reshape costs across the business.
The move suggests that savings measures are not limited to smaller markets, but also include core locations.
Telecom equipment slowdown keeps pressure on suppliers
Ericsson has been trying to cut costs and improve margins during a difficult period for telecom network suppliers.
The sector has struggled for years as demand weakened and operators held back on major investments.
A Bloomberg report notes that a key issue has been that carrier spending linked to 5G technology did not arrive at the level many in the industry had anticipated.
With a slower pace of network upgrades, equipment suppliers have faced tougher sales conditions and a more competitive market environment.
Ericsson’s Nordic rival Nokia Oyj, has also struggled under the same market pressures, showing the slowdown has affected multiple major suppliers across the region.
Layoffs follow earlier restructuring plan
The latest cuts build on Ericsson’s earlier restructuring efforts.
In 2023, the company announced a global plan to cut 8,500 jobs, which was equal to about 8% of its workforce at the time.
Since then, the company has continued reducing staff levels. Ericsson axed hundreds of employees in Spain and Canada last year, keeping the restructuring process active beyond the initial global announcement.
With the new cuts now focused on Sweden, Ericsson appears to be extending that multi-year plan to reduce costs and support profitability while demand remains under pressure.
Share performance shows market uncertainty
Ericsson’s restructuring moves come at a time when investor confidence has been tested.
The company’s share price has fallen about 8.5% over the past 12 months.
That decline reflects the ongoing challenges across the telecom equipment market, including slower carrier spending, weaker demand, and the need for suppliers to keep tightening their operations.
For Ericsson, cutting jobs is one way to respond to these conditions as it continues to manage costs.
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