Nokia saw its share price fall sharply after it published its interim report for the first quarter of 2018 on Thursday, 26 April.
The network equipment manufacturer posted first-quarter net sales of 4.9 billion euros, representing a drop of 500 million euros from the previous year. Its operating profit, in turn, decreased by almost 100 million euros year-on-year to 239 million euros between January and March.
The lacklustre quarter is not a major concern for the iconic company, however.
“We see strong momentum building for the full year despite a slow start in networks,” Rajeev Suri, the CEO of Nokia, said in a press release. “I have considerable confidence that Nokia is well-positioned to outperform a strengthening networks market and meet our full-year 2018 guidance.”
His confidence arises particularly from a strong order intake in the first quarter and the expected, large-scale commercial roll-outs of 5G in the United States.
“Our end-to-end portfolio positions us very well for 5G and our efforts to accelerate global 5G adoption are clearly delivering results. We will fuel that adoption in 2018 with investments in trial costs, as needed. These investments will position us to capture opportunities in a 5G market that we believe will substantially accelerate later this year in the United States,” stated Suri.
Suri also pointed out that the primary reasons for the year-on-year decline in the gross margin of the network business are largely temporary in nature, with improvements expected in the second half of 2018.
Nokia, as a result, reaffirmed its guidance for the year.
Aleksi Teivainen – HT
Photo: Aku Häyrynen – Lehtikuva