Nokia billed 5,859 million euros between January and March, which means a 9.5% increase in the interannual rate. The net profit attributed to him was 31.6% more than in the same period of 2022, accumulating 279 million euros. However, his figures are below expectations.
The main cause that the company points to is the slowdown in customer spending level and the severe economic recession that is plaguing the entire world, and specifically, the technology sector. To this is added the curbing demand for your 5G equipment in some of the company’s most consolidated markets. Your CEO, Pekka Lundmarkassured that the company had to maintain its cost discipline, despite its tight earnings per share.
As published by Bloomberg, analysts estimated profit of 544 million euros and about 7 cents in earnings per share. But the reality has finally been quite different, since its adjusted operating profit was 479 million euros (525 million dollars) during the first quarter and earnings per share of 6 cents.
As for the gross profit of Nokia during the first quarter of 2023, this was 2,196 million euros, 1.2% more in the interannual rate, while its operating profit reached 426 million, which represented an increase of 20.3%. For his part, he comparable net profitexcluding extraordinary fees, fell by 18% and stood at 342 million euros, the main cause being the drop in profit margins compared to the same period in 2022.
He Operating margin The comparable fell by 270 basis points to a drop of 8.2%, something Nokia attributes to the loss of profitability of its mobile network and intellectual property businesses, as well as the negative impact of its investments in venture funds.
Your level of sales
Despite not having reached the estimate quotas of the analysts, the Finnish technology experienced a increase in sales in the sector of corporate clients, reaching 566 million euros, a growth of 65%. Similarly, increased its revenues in Europe, Latin America, Africa and Indiain the latter billing 853 million euros, 327% more than in the first quarter of 2022.
Nokia’s net sales grew 10% in the first quarter, up to 5,860 million euros, exceeding estimates. Now it is expected that the year 2023 will close with profits of between 24,600 and 26,200 million euros.
The opposite side of the coin for Nokia it comes from China, where it reduced its sales by 14%, as well as the Asia-Pacific and North America regions, where the rate fell by 9%. These data are curious, since the United States has always been the most important market in its billing rates.
The data of your departments
If we analyze the data submitted by your mobile telecommunications network business, Mobile Networks entered 2,567 million euros13% more in the interannual rate, although its operating profit ended up being reduced by 20% to 137 million euros due to the notable decrease in profit margins.
Network Infrastructure, Nokia’s combination of hardware devices, software applications and network services, represents the second largest business by revenue. It invoiced 2,248 million euros, 13% more than in the previous year, generating an operating profit of 344 million euros, that is, an increase of 76%.
For his part, Cloud and Network Servicesthe cloud and network services division, increased its sales by 3% to reach €760 millionalthough the fall in margins and the greater investment in R&D caused an operating loss of 20 million, despite the fact that in the first quarter of 2022 20 million euros were earned.
In the case of Nokia Technologieswhich manages the range of patents and licenses of the company, saw its turnover reduced by 21% up to €242 million, reaching an operating profit of 149 million euros, 32% less. All this refers to the intellectual property of third parties and Nokia mobiles manufactured under license and exclusively by the Finnish HMD Global.
