Espoo: Nokia said on Thursday that its first-quarter profit fell far short of the market consensus and warned of additional impact from new US tariffs during the coming months. Comparable operating profits fell to €156 million ($176.9 million), considerably lower than the average forecast of €243.83 million among analysts polled by LSEG, a 36% miss.
While standing €4.39 billion net sales, down 1% year-on-year, it missed expectations. The expected figure was around €4.41 billion, but Nokia kept its guidance for the fiscal year. Notably, it figured another biting but: an expected €20-30 million dent in Q2 profits, alluding to the trade spat initiated under the Trump administration, which has sparked speculation across the telecom industry.
Despite tough competition with Swedish rival Ericsson, North America remains quite a good market for Nokia, which was coming alive again as a market. These tariffs probably wouldn't help the order run, customers become a bit more careful about increasing equipment costs.
Nokia is now further strengthening its backbone in optical networking with the move ahead to take direct control for its Infinera acquisition. This is part of a very strategic move, extending its multi-year relationship with T-Mobile in the US on the 5G front to cover expanded network reach for the carrier.
As Nokia faces rising barriers to trade and tough competition in the marketplace, it continues to be cautiously optimistic by managing its costs, increasing its strategic alliances, and growing its 5G footprint against political uncertainty.
[Source Credit: Business Recorder]
