Nokia shares slump after sales miss, cautious commentary

By Steve Goldstein

Nokia says mobile customers continue to be cautious

Nokia shares slumped on Thursday as the Finnish telecom equipment maker reported challenging conditions in mobile networks as well as cloud and network services.

Nokia shares (FI:NOKIA) (NOK) dropped 6% in Helsinki trade, though they've gained 10% this year.

Nokia reported a EUR142 million ($155 million) loss for the quarter, as sales fell 18% to EUR4.47 billion.

Excluding a EUR514 million impairment charge on its submarine networks business, Nokia said its profit would have declined 20% to EUR328 million.

Analysts polled by Visible Alpha had expected a profit of EUR264 million on sales of EUR4.74 billion.

Last month, Nokia said it was selling the submarine business to the French government, as it also inked a deal to buy Infinera (INFN) to boost its optical and networks business.

Nokia said it continues to run against difficult comparisons to India's 5G deployment, and it also said mobile operators continue to be cautious. Last year, Nokia said it would cut 14,000 jobs because of difficult conditions.

Nokia is dealing with the fallout of losing a big portion of AT&T's (T) business. According to UBS, Nokia expects its sales in mobile networks to AT&T to remain largely stable year-on-year in 2024 and then approximately halve in 2025.

Nokia said its comparable operating profit this year may reach the midpoint, or slightly below, its previous guidance of between EUR2.3 billion and EUR2.9 billion, but free cash flow will be at higher end of between 30% and 60% of that core profit.

-Steve Goldstein

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07-18-24 0617ET

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