Nokia has announced it plans to cut 10,000 jobs from is global workforce as the company faces continued pressure in the smartphone market.
The Finnish company said it was to "rescale" the company by cutting positions in its Devices & Services divisions, and close some of its offices in Germany and Canada.
While Nokia claims that 1.3bn people use one of their devices every day, the company has struggled in the smartphone space to compete with Apple and Android-based devices made by Samsung, HTC and others.
Its recent high-end Lumia 800 and 900 devices, running the Windows Phone OS, have received generally positive reviews - and the company also gained plaudits for the innovative camera in its 808 PureView device.
But their success with critics has not yet translated into sales.
While announcing the job cuts, Nokia also lowered its expectations for the quarter, blaming "competitive industry dynamics".
It also said that executives Jerri DeVard, Mary McDowell, and Niklas Savander would leave the company.
Meanwhile Nokia also announced the same of its premium 'Vertu' phone division and brand.
EQT VI, a private equity firm, will acquire the group for an undisclosed fee.
Despite the cuts, Nokia CEO Stephen Elop said the company was still focused on making its Lumia smartphones a success.
"We are increasing our focus on the products and services that our consumers value most while continuing to invest in the innovation that has always defined Nokia," he said.
"We intend to pursue an even more focused effort on Lumia, continued innovation around our feature phones, while placing increased emphasis on our location-based services.
"However, we must re-shape our operating model and ensure that we create a structure that can support our competitive ambitions."
Julian Jest, a research analyst at Informa Telecoms & Media, said the cuts "primed" the company for a takeover bid - possibly from Facebook.
"This really doesn’t come as a big surprise, in making the cuts to its workforce, Nokia will buy itself more time as it seeks to turn around its recent woes.
"Despite the backing from Microsoft to implement the Windows Phone OS, Nokia’s revenue has been on the decline and their credit rating cut. Nokia have an excellent history of producing attractive, well built handsets, including the current crop of Lumia devices. As a result they are prime targets for a takeover bid."
"Facebook, for example, have plenty of cash to invest as a result of their recent IPO. In regards to its business in the mobile space, Facebook has not had much success, and may be considering new strategies, including developing their own phone. To avoid such threats, drastic action such as the announced cuts should give Nokia more time to build on its strengths and reverse its declining fortunes."