Nokia has announced it will lay off 10,000 workers worldwide by the end of 2013 in a further drive to save costs.
The Finnish mobile phone maker said it aims to return the company to profitable growth by sharpening strategy and improving its operating model.
Although it plans "to significantly reduce its operating expenses", Nokia said it remains focused on its smartphones and feature phones and intends to expand location-based services.
Nokia is fighting fierce competition from Apple's iPhone and other makers using Google's popular Android software, including Samsung and HTC of Taiwan.
Nokia said that "competitive industry dynamics" in the second quarter would hit its smartphone sector to a "somewhat greater extent than previously expected" and no improvement was expected in the third quarter.
Spokesman Timo Ihamuotila said: "Nokia intends to maintain its strong financial position while proceeding aggressively with actions aimed at creating shareholder value."
Last year, Nokia announced more than 10,000 lay-offs, aimed at cutting operating expenses.