Nokia to cut R&D staff

HELSINKI: The world's top handset maker Nokia plans to cut hundreds of jobs in Finland and abroad as part of its plan to reel in research spending, with earnings to be affected in the first quarter as a result.

Finland's Nokia said it would slash up to 250 staff in Finland and "a few hundred" more in Germany and elsewhere, as it follows through on plans to curtail research and development spending to 9-10 percent of sales by the end of 2006 from 13 percent in 2003. Nokia said the cuts would take place gradually during 2005. It had 19,849 staff at its R&D facilities by end-2003.

"We do expect to make some kind of charge ... in the first quarter. It could be some tens of millions of euros," Nokia spokesman Kari Tuutti told. "But we could say that we expect to get significant cost savings."

Nokia first announced plans to lower R&D spending in November, part of the firm's overall drive to keep costs in check as it tries to win back global market share lost in 2004 due to an uncompetitive handset portfolio.

(Additional reporting by Daniel Frykholm)