While it’s hard to feel bad for a multi-billion-dollar technology company that got its start making paper products, you've gotta feel at least something for Nokia and its past 12 months. The vendor did have its share of highs, but also a good number of lows.

With 2024 just around the corner, which will hopefully bring a bit more stability for Nokia, we thought we'd take one more look back at the vendor’s roller coaster of a year.

Nokia entered 2023 with momentum as the vendor rode strong 5G-related sales growth in India that countered an already slowing North American market. It then rode that momentum through the first quarter where it posted a 10% year-over-year increase in sales and a more substantial 32% increase in net profits.

However, that momentum quickly slowed as sales in India eventually began to dry up and North American operators continued to constrict spending. The one saving grace in this department was that Nokia wasn’t alone in its struggles, as basically the entire telecommunications and networking vendor ecosystem had a crappy 2023.

Nokia early in the year attempted to kickstart its reputation with a new branding, marketing and operational initiative, which included a stripped-down logo and colorful t-shirts for all of its executives.

Nokia CEO Pekka Lundmark told a press event just ahead of the MWC Barcelona 2023 event that the new branding initiative had Nokia literally carving up its name to signify the need for greater collaboration across the market. “When you take the different letters, which are kind of stick-like, and you put them together and everybody sees that it says Nokia,” Lundmark said.

More than just a new font and colors, Lundmark also laid out pillars and enablers the vendor would use to finish off its three-year turnaround plan.

One of those enablers included Nokia taking advantage of the U.S. government’s $42.5 billion Broadband Equity, Access and Deployment (BEAD) program, which is aimed at boosting the country’s broadband coverage.

Nokia’s initial push involved setting up a partnership with Wisconsin-based equipment manufacturer Sanmina to produce fiber-optic broadband network equipment. Lundmark said the deal would allow the vendor to quickly scale U.S. production to meet the needs of its customers, specifically noting Verizon, AT&T and Telephone Data Systems (TDS).

It also involved creating 200 new jobs, which drew the presence of U.S. Vice President Kamala Harris.

Nokia quickly followed that deal by striking a similar arrangement with California-based Fabrinet to also construct optical networking equipment.

Nokia did not state the exact number of new jobs that would come out of that deal, with Stefaan Vanhastel, VP of marketing and innovation for Nokia Fixed Networks, explaining to SDxCentral that it will depend “on some practical questions we still need to answer, but this will create additional jobs and these are high-tech components so these will also be high-tech jobs that are introduced.”

Nokia claims more than 70% of U.S. fiber broadband connections in North America are made through its equipment, which could prove a compelling toe hold for an opportunity expected to rely heavily on fiber investments.

Nokia in October announced plans to slash up to 14,000 jobs as part of a “resetting” of its “cost base to protect profitability.” That reset will reduce its headcount from around 86,000 employees today to between 72,000 and 77,000 employees.

The cuts are targeted at saving up to $1.3 billion in operational costs by 2026, which Nokia stated would be a 10% to 15% drop in personnel expenses. The job cuts are set to impact Nokia’s mobile networks, cloud and network services and corporate functions.

Lundmark told investors during the vendor’s third-quarter earnings call that the total number of job cuts and financial impact will be tied to ongoing market conditions.

“The exact scale of the program will depend on the evolution of the market demand in the coming years,” Lundmark said. “We do expect net savings, but the magnitude will depend on how inflation develops.”

Lundmark also noted that the vendor was focused on protecting its R&D efforts, which could include a greater use of artificial intelligence (AI) to replace human efforts.

“There is obviously very interesting opportunities to improve R&D productivity through new technologies,” Lundmark said. “We have already seen that in the right hands; for example, AI copilots are significantly improving the productivity of software development. So, there are opportunities in terms of R&D productivity, but we are clearly going to always defend our ability to deliver R&D output.”

Nokia’s 2023 ended on a further down note when it was bypassed by long-time customer AT&T as part of that carrier’s $14 billion open radio access network (open RAN) push. This indignation was furthered by AT&T selecting rival Ericsson as its open RAN platform base.

Lundmark attempted to deflect AT&T’s decision as being financially driven and not because of equipment performance, which was reportedly the reason the vendor lost a 5G RAN contract with Verizon in 2020.

“I’m glad that this decision was not because of our performance, because of our technology or the performance of our services,” Lundmark said during Nokia’s year-ending progress update. “Our understanding is that since these are not the reasons and it was not relationship either, it is mostly financially driven.”

Lundmark did note that while “losing the AT&T deal hurts,” the vendor did score a new deal with Germany’s Deutsche Telekom to provide open RAN equipment as part of that carrier’s ongoing multivendor deployment.

“[That’s] a significant return to a network that is the largest in Europe and that we have been out of since 2017,” Lundmark said.

Lundmark also downplayed the overall financial impact AT&T’s decision would have on Nokia, stating the carrier accounted for only a single-digit percentage of its 2023 sales, but the executive is instituting new cost-cutting measures to counter the financial drag. This includes slashing costs so that Nokia’s mobile networks division can maintain previously announced margin goals with $1.6 billion less in sales revenues.

“It is pretty straightforward math when you take those margin targets and then certain volume assumptions, and we believe that it is entirely doable,” Lundmark said. “But, of course, it would not be possible without the cost-cutting actions that we are taking.”

Nokia is also banking – literally – on a broader market turnaround. Lundmark said that the vendor is starting to see sales progress during the final quarter of the year.

“We said that with our Q3 results, the outlook for net sales remained challenging, but that we were starting to see some early signs that we could see improving order in tech trends,” Lundmark said. “And as it now seems in [network infrastructure], it actually seems to be true that Q3 was the low point in orders. And now we are seeing clear improvement in orders in the fourth quarter exactly as we were expecting after Q3.

“Of course, there is then a cycle from orders to delivery, a couple of quarters some cases – even three quarters – so it will take time before all of this will come through in the top line. But it currently looks promising and we do expect to see our [network infrastructure] business return to growth in 2024.”