On Thursday, Nokia (NOKIA.HE) reported first-quarter operating profit below market expectations and warned customer spending was slowing.
It maintained its full-year outlook and predicted greater second-half profitability.
Refinitiv analysts predicted 532.4 million euros for first-quarter comparable operating profit, which declined to 479 million euros ($524.94 million) from 583 million euros last year.
Nokia and Ericsson (ERICb.ST) have relied on sales growth in India, where telecom operators establish a 5G network, to offset slowdowns in high-margin countries like the US.
“What we are seeing in India at the moment is the fastest 5G rollout the world has ever seen,” Nokia CEO Pekka Lundmark said in an interview.
Nokia gets 15% of its revenue in India from Reliance (RELI.NS), Jio, and Bharti Airtel (BRTI.NS).
Nokia reported net sales of 5.86 billion euros, 10% higher than expected.
Lundmark forecasts a second-half North American market revival.
The operating margin dropped to 8.2% from 10.9%. It predicted 2023 margins of 11.5%–14%.
Nokia is expanding beyond telecom providers to industrial customers building private 5G networks at power plants and mines.
Danske Bank Credit Research analyst Mads Lindegaard Rosendal attributed the profits loss to Nokia’s patent licensing business.
Lundmark blamed Oppo and Vivo lawsuits.
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