Nokia Corp (NOK), the Finnish telecom equipment giant, is actively searching for a new CEO as it navigates a challenging landscape marked by declining sales and a depressed share price. The company has reportedly reached out to potential candidates to replace current CEO Pekka Lundmark, who has held the position since 2020. While Lundmark initially stabilized the company, he has faced criticism for failing to drive revenue growth.
Despite restructuring efforts and cost-cutting measures, Nokia’s sales remain lower than they were in 2016, following its €15.6 billion acquisition of Alcatel-Lucent. The search for a new CEO coincides with Nokia’s search for a new chair, as current chair Sari Baldauf approaches her 70th birthday next year. Outsiders have been contacted for the role, suggesting a shift in leadership beyond the current board.
In a statement, Nokia affirmed its support for Lundmark and emphasized that it is not currently undergoing a process to replace him. However, the company acknowledged the ongoing assessment of leadership succession plans, hinting at a potential change in the near future.
The search for new leadership arrives amid a period of sluggish spending by telecom operators and intensified competition from rivals like Ericsson and Huawei. Nokia’s struggles are further underscored by its recent financial performance. In July, the company reported a fiscal second-quarter 2024 net sales decline of 18% year-on-year, marking a record low since 2015. The drop was attributed to weak investment in mobile network upgrades, particularly in the 5G equipment market, leading Nokia to overhaul its network infrastructure division.
In June, Nokia announced the acquisition of Infinera Corporation in a $2.3 billion deal aimed at bolstering its optical networking capabilities. This move, coupled with a multi-year agreement with AT&T Inc. to deploy next-generation fiber access technology and a partnership with CommScope Holding Company, Inc. to develop a solution for seamless connectivity, reveals Nokia’s ongoing efforts to adapt and invest in new technologies.
The search for a new CEO and chair represents a significant turning point for Nokia as it navigates a challenging market landscape. The company’s ability to attract a strong leader who can guide it through these turbulent times will be crucial for its future success.
