Nokia ( NOK ) Corp is actively searching for a new CEO as it struggles with declining sales and a depressed share price.

What Happened: The Finnish telecom equipment giant has approached potential candidates to replace current CEO Pekka Lundmark, who has been at the helm since 2020. The search is ongoing, with at least one headhunter involved in the process, Financial Times reported citing, people familiar with the matter.

Lundmark, who initially stabilized the company, has faced criticism for failing to boost revenues. Despite restructuring efforts and cost-cutting measures, Nokia’s sales remain lower than they were in 2016, following its €15.6 billion acquisition of Alcatel-Lucent.

Additionally, Nokia ( NOK ) is seeking a new chair as Sari Baldauf approaches her 70th birthday next year. Outsiders have been contacted, and the new chair is not expected to come from the current board, according to the report.

In a statement, Nokia ( NOK ) said, “The Board fully supports President and CEO Pekka Lundmark and is not undergoing a process to replace him.” The company emphasized its ongoing assessment of leadership succession plans, according to the report.

The search for new leadership comes as Nokia ( NOK ) grapples with sluggish spending by telecom operators and increased competition from rivals like Ericsson and Huawei.

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Why It Matters: Nokia’s leadership shakeup comes on the heels of several significant developments. In July, Nokia ( NOK ) reported a fiscal second-quarter 2024 net sales decline of 18% year-on-year, marking a record low since 2015.

This drop was attributed to weak investment in mobile network upgrades, particularly in the 5G equipment market, prompting Nokia ( NOK ) to overhaul its network infrastructure division.

In June, Nokia ( NOK ) announced its acquisition of Infinera Corporation in a transaction valuing the company at $6.65 per share, or an enterprise value of $2.3 billion. This acquisition aimed to bolster Nokia’s optical networking capabilities.

Furthermore, last year, Nokia ( NOK ) disclosed a multi-year agreement with AT&T Inc. to deploy next-generation fiber access technology. This five-year deal includes upgrading AT&T's current fiber infrastructure and implementing next-gen technologies for future expansions.

Additionally, Nokia ( NOK ) teamed up with CommScope Holding Company, Inc. to develop a solution for seamless in-building and campus-wide connectivity. This partnership integrates Nokia's ( NOK ) fiber-based Optical LAN with RUCKUS Networks' enterprise Wi-Fi and switching technologies.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote