Swedish telecoms equipment giant Ericsson said Monday it was cutting 1,200 staff in Sweden, or 8.6 percent of its Swedish workforce, as it faces a "challenging" market for mobile networks.

The company said it "expects a challenging mobile networks market in 2024, with further volume contraction  as customers remain cautious."

"In line with managing lower volumes, Ericsson today announces proposed staff reductions in Sweden," it said in a statement.

Ericsson said the measure was part of global initiatives to reduce costs, including staff reductions, streamlining processes and reducing consultants, "while maintaining investments critical to Ericsson's technology leadership."

It said it had initiated negotiations with unions for a "headcount reduction of approximately 1,200 in Sweden."

According to Ericsson, the company's Swedish organisation employs around 14,000 people across all business areas.

Globally, Ericsson has around 100,000 staff.

Ericsson posted a sizeable loss in 2023 as a result of write-downs and restructuring costs, warning in January that it was expecting further market decline.

Ericsson said it was 26.1 billion kronor ($2.5 billion) in the red last year after making a 19-billion-kronor profit in 2022.

The company, which is in a fierce competition over 5G networks with Finland's Nokia and Chinese high-tech firm Huawei, in February 2023 also launched a cost-cutting programme that included eliminating 8,500 jobs.

Nokia said last year it could cut its workforce by up to 14,000 people, reducing costs by up to 1.2 billion euros by 2026.