Swedish telecom giant Ericsson said on Monday it would lay off about 1,200 employees in Sweden as a part of cost cuts announced earlier this year, citing a "challenging" mobile networks market and lower volumes in 2024.

After a few years of high demand for 5G equipment, buying by telecom providers has slowed, prompting firms such as Ericsson and Nokia to lay off thousands of employees to save costs.

"As previously stated, Ericsson expects a challenging mobile networks market in 2024, with further volume contraction as customers remain cautious," the company said in a statement.

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

Ericsson will continue its initiatives to increase operational efficiency during 2024, but will not make any separate statements on those, it added.

The company 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 organization employs around 14,000 people across all business areas.

Globally, Ericsson has around 100,000 staff.

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 fierce competition over 5G networks with Finland's Nokia and Chinese high-tech firm Huawei, in February 2023 also launched a cost-cutting program 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.

Ericsson had told Reuters in January it could look at further cost cuts this year including layoffs but without giving a specific number.