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  • Nokia Cuts Operating Margin Guidance Amid Challenging Market

    Nokia Cuts Operating Margin Guidance Amid Challenging Market

    Updated Dec. 12, 2023 2:54 am ET

    Nokia cut its operating margin guidance, with market conditions in its mobile networks business remaining challenging due to falling operator spending and the Indian market normalizing after a period of rapid 5G roll-outs.

    The Finnish telecom equipment maker said Tuesday that it now targets a comparable operating margin target of at least 13% by 2026, from at least 14% previously.

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  • Nokia Cuts Operating Margin Guidance Amid Challenging Market

    Nokia Cuts Operating Margin Guidance Amid Challenging Market

    By Dominic Chopping

    Nokia cut its operating margin guidance as market conditions in its mobile networks business remain challenging, with operator spending falling and a normalization in India after a period of rapid 5G deployment.
    

    The Finnish telecom equipment maker said Tuesday that it now targets a comparable operating margin target of at least 13% by 2026, from at least 14% previously.
    

    

    “Nokia still sees a path to achieving the at least 14% comparable operating margin target but considering the current market conditions in mobile networks, this is deemed a prudent change,” the company said.
    

    Write to Dominic Chopping at dominic.chopping@wsj.com
    

    

    


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    Nokia to cut as many as 14,000 jobs as profit drops by 69%
    
			
    Nokia to cut as many as 14,000 jobs as profit drops by 69%
    
			
    

    

    Nokia on Thursday set out plans to cut its workforce by up to 14,000 as it reported a steep drop in third-quarter profit. 
    

    The telecom equipment maker said it’s looking to reduce its workforce to between 72,000 and 77,000 workers, from 86,000 now, by the end of 2026. Nokia
    
        NOKIA,
    
        -4.14%
    

            NOK,
    
        -2.87%
    
       said that could save the company as much as €1.2 billion ($1.3 billion), or up to 15% of personnel expenses.
    

    

    “We continue to believe in the mid to long term attractiveness of our markets. Cloud Computing and AI revolutions will not materialize without significant investments in networks that have vastly improved capabilities. However, given the uncertain timing of the market recovery, we are now taking decisive action on three levels: strategic, operational and cost. I believe these actions will make us stronger and deliver significant value for our shareholders,” said Pekka Lundmark, president and chief executive, in a statement.
    

    The company didn’t provide a regional breakdown of the job cuts but said it will “act quickly” as it targeted mobile networks, cloud and network services, as well as its corporate function, for cuts. 
    

    Nokia’s profit dropped by 69% to €133 million, or 2 cents a share, as revenue fell 20% to €4.98 billion. Analysts polled by Visible Alpha forecast earnings of €395 million on revenue of €5.66 billion. 
    

    Nokia shares dropped 4%, and have fallen by 28% this year.
    

    In echoes of what rival Ericsson
    
        ERIC.B,
    
        -1.21%
    
       said on Tuesday, Nokia said a slowdown in India’s 5G deployment could not offset the situation in North America.
    

    Nokia said it’s tracking toward the lower end of its net sales range for 2023 and toward the mid-point of its comparable operating margin range.
    

    

    


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    Nokia Preliminary 2Q Sales EUR5.7B
    
			
    Nokia Preliminary 2Q Sales EUR5.7B
    
			
    

    

    By Dominic Chopping
    

    Nokia on Friday lowered its full-year net sales guidance and narrowed its operating margin outlook amid a weaker demand picture in its network infrastructure and mobile networks businesses due to a tougher macroeconomic environment and as customers work through built-up inventory.
    

    

    The Finnish telecommunications-equipment company now sees sales of between 23.2 billion euros and 24.6 billion euros ($26.05 billion-$27.62 billion) from EUR24.6 billion to EUR26.2 billion previously.
    

    The comparable operating margin is seen at 11.5% to 13% from 11.5% to 14% previously.
    

    “Customer spending plans are increasingly impacted by high inflation and rising interest rates along with some projects now slipping to 2024–notably in North America,” Nokia said.
    

    “There is also inventory normalization happening at customers after the supply chain challenges of the past two years.”
    

    Ahead of the company’s second-quarter earnings on July 20, Nokia also reported preliminary net sales of around EUR5.7 billion for the three-month period and a comparable operating margin of around 11%, with operating profit boosted by EUR80 million related to catch-up payments in its technologies unit.
    

    The company said it will continue to take measures to ensure it remains on track towards its long-term targets of growing faster than the market and delivering a comparable operating margin of at least 14%.
    

    Write to Dominic Chopping at dominic.chopping@wsj.com
    

    

    


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    Nokia posts forecast-beating net profit
    
			
    Nokia posts forecast-beating net profit
    
			
    

    

    Nokia Corp. on Thursday posted a forecast-beating third-quarter net profit as demand for mobile networks and network infrastructure remained strong and supply-chain constraints eased.
    

    Nokia
    
        NOK,
    
        -1.94%
    

            NOKIA,
    
        -6.26%
    
       said it still expects to deliver net sales growth in mobile networks on a constant-currency basis in 2022 after strong sales growth in North America during the quarter, while sales in Europe, Latin America and Greater China also grew.
    

    

    Comparable net profit for the quarter rose to 550 million euros ($537.6 million) from EUR454 million a year earlier as sales rose 16% to EUR6.24 billion, it said.
    

    Analysts polled by FactSet had expected comparable net profit of EUR510 million on sales of EUR6.05 billion.
    

    On a reported basis, Nokia posted a net profit of EUR427 million from EUR342 million a year earlier.
    

    Nokia lifted full-year sales guidance to between EUR23.9 billion and EUR25.1 billion from EUR23.5 billion and EUR24.7 billion, adjusted for currency. It still sees the full-year comparable operating margin at 11%-13.5%.
    

    “While risks around timing of outstanding deals in Nokia Technologies remain, assuming these close we continue tracking towards the high-end of our net sales guidance for 2022 and towards the mid-point of our operating margin guidance,” Chief Executive Pekka Lundmark said.
    

    Write to Dominic Chopping at dominic.chopping@wsj.com
    

    

    


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  • 
		
		
    
			
    Nokia posts forecast-beating net profit
    
			
    Nokia posts forecast-beating net profit
    
			
    

    

    Nokia Corp. on Thursday posted a forecast-beating third-quarter net profit as demand for mobile networks and network infrastructure remained strong and supply-chain constraints eased.
    

    Nokia
    
        NOK,
    
        -1.94%
    

            NOKIA,
    
        -5.29%
    
       said it still expects to deliver net sales growth in mobile networks on a constant-currency basis in 2022 after strong sales growth in North America during the quarter, while sales in Europe, Latin America and Greater China also grew.
    

    

    Comparable net profit for the quarter rose to 550 million euros ($537.6 million) from EUR454 million a year earlier as sales rose 16% to EUR6.24 billion, it said.
    

    Analysts polled by FactSet had expected comparable net profit of EUR510 million on sales of EUR6.05 billion.
    

    On a reported basis, Nokia posted a net profit of EUR427 million from EUR342 million a year earlier.
    

    Nokia lifted full-year sales guidance to between EUR23.9 billion and EUR25.1 billion from EUR23.5 billion and EUR24.7 billion, adjusted for currency. It still sees the full-year comparable operating margin at 11%-13.5%.
    

    “While risks around timing of outstanding deals in Nokia Technologies remain, assuming these close we continue tracking towards the high-end of our net sales guidance for 2022 and towards the mid-point of our operating margin guidance,” Chief Executive Pekka Lundmark said.
    

    Write to Dominic Chopping at dominic.chopping@wsj.com
    

    

    


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