Nokia’s turnover is lower than expected and the outlook has weakened

Network devices the turnover of Nokia, the manufacturer, was lower than expected in July–September, but the operating profit met expectations. The company changed its estimate of the development of the operating profit to a darker one.

Nokia still estimates that it will achieve its operating profit target of 2.3-2.9 billion euros this year, but now estimates that it will be in the “lower half” of the range. Shortly after the start of trading, the company’s share fell three percent to 3.9 euros on the Helsinki Stock Exchange.

Managing director Pekka Lundmarkin according to the report, the turnover will also recover more slowly than expected, but this will be compensated by the improvement of the gross margin and cost control. The gross margin, i.e. the gross margin, is calculated by deducting the manufacturing and purchasing costs from the turnover.

“Despite the challenging market situation, mobile phone networks won several important contracts during the quarter, our competitiveness is strong and we have improved our gross margin,” says Lundmark in the interim report.

Nokia won at the end of September In India, a large contract and is negotiating with a news agency Reuters currently from another big store in India.

Turnover decreased by seven percent to 4.3 billion euros. Comparable operating profit, on the other hand, grew by nine percent to 454 million euros.

Analysts estimate in advance that the turnover was 4.7 billion euros and the comparable operating profit was 455 million euros.

The operating profit percentage measuring Nokia’s profitability was 10.5 in July–September. In the same period last year, it was 8.9.

“There is reason for optimism in all of our business groups. We expect the growth of the network infrastructure to accelerate significantly in the last quarter of the year, and several structural demand trends support our future growth opportunities,” says Lundmark in the interim report.

Net cash at the end of September was 5.5 billion euros, compared to just under three billion euros a year earlier.

Nokian the turnover of the largest business group, i.e. mobile phone networks, decreased by 17 percent to 1.7 billion euros in July–September, and the operating profit by seven percent to 92 million euros.

The turnover of network infrastructure, i.e. mainly fixed networks, remained unchanged at 1.5 billion euros, but the operating profit increased by nine percent to 180 million euros.

The turnover of cloud and online services decreased by five percent to 702 million euros. Nevertheless, the operating profit of this business group increased by 81 percent to EUR 65 million.

The turnover of the technology unit responsible for patent licensing increased by 35 percent to 352 million euros and the operating profit by 34 percent to 242 million euros.