Nokia is reportedly pulling back sharply from China, closing its Hangzhou research and development (R&D) centre and cutting around 1,600 jobs. The decision follows years of declining business in the country and comes less than a year after the company assumed full ownership of its joint venture, Nokia Shanghai Bell. Other sites in Beijing, Chengdu, Qingdao, and Shanghai are also reportedly under review for possible restructuring, signalling a broader retreat from the Chinese market.
The company has dramatically increased its restructuring budget for 2026, raising guidance from €250 million to €800 million, with €350 million allocated specifically to China. Nokia expects about €200 million in savings from these measures. This reflects both financial pressures and geopolitical realities, as executives have acknowledged that national security concerns have effectively shut the company out of China’s telecom market.
The scale of Nokia’s decline in China is stark. Annual revenue in Greater China has dropped from nearly €2.2 billion in 2018 to €913 million in 2025. Headcount has more than halved, falling from 13,700 employees in 2020 to 7,200 in 2025. The Hangzhou closure is the most visible sign of this contraction, but analysts expect further cuts across the region.
Nokia’s leadership has framed the restructuring as part of a global integration strategy, aiming to streamline operations and boost productivity. The company has chosen to invest beyond its original restructuring commitments to capture additional savings opportunities. While specific job numbers outside China were not disclosed, estimates suggest that European restructuring alone could affect more than 2,000 roles.
Nokia’s China retreat is not just about cost control—it underscores the geopolitical barriers facing foreign telecom firms in the country, while highlighting the company’s push to refocus resources on markets where it sees stronger growth potential.
