Economic|Interim reports
Nokia will publish its April-June interim report on Thursday at 8 p.m.
Network devices Nokia’s manufacturing business is gaining new momentum.
The company issued two weeks ago a positive earnings warning in which it announced it would improve its assessment of the development of its business in its interim report, which the company will publish on Thursday at 8 p.m.
According to preliminary information, Nokia’s plans to improve its technological leadership have progressed well, cost discipline has been strong and the market has developed favorably.
Major interest is focused on the company’s assessment of the operating profit margin, which measures profitability. So far, Nokia has estimated that the operating margin will be 7-10 this year.
Analysts estimate that Nokia’s net sales in April-June were EUR 5.2 billion and operating profit excluding non-recurring items was EUR 404 million. That would mean a 2 percent increase in revenue and a 4 percent decrease in operating profit from the same period last year.
At the beginning of the year, Nokia surprised with a clearly better-than-expected operating profit. In January-March, operating profit excluding non-recurring items was EUR 551 million.
Read more: Nokia’s long torment is beginning to ease: “We have developed better products,” says CEO Pekka Lundmark
The first quarter is usually the weakest year of the year in the network equipment market. Therefore, the second-quarter operating profit released on Thursday may be better than analysts’ expectations – especially as the company announced in its positive earnings warning that the strong business development continued in the second quarter.
The value of Nokia’s share has increased by 56 percent during the current year.
Year then started as CEO Pekka Lundmark initiated major changes in the company: the operating method has been simplified, the number of business groups has been reduced to four and investments, especially in the product development of fifth-generation (5g) mobile phone technology, have been significantly increased.
Due to the large 5g investment and operational simplification, Nokia estimates it will cut in March in different parts of the world gradually over two years between 5,000 and 10,000 jobs.
Large investments in 5g technology have already started to pay off before Lundmark’s CEO term.
Midsummer before, Nokia said it had completed two years of new 5g base station products it had developed, which it believes has caught up with competitors. The company has already sold these new products in the previous quarter.
In the new products, Nokia will take advantage of system circuits with lower costs and better technical features.
“We were ahead of the competitors in 5g, but with the new products we can catch up,” said the head of mobile networks Tommi Uitto at the end of June.
Read more: These are the new 5g products with which the troubled company plans to rise back to the top
Second an interesting fact in the interim report is what the company says about the development of its business in china.
China Mobile, the world’s largest telecom operator said in mid-July that Nokia has won a larger share of new new 5G orders than its Swedish competitor Ericsson in the tender.
Nonetheless, both Nokia and Ericsson account for a small share of China Mobile’s orders, as Chinese telecom operators favor domestic companies that are struggling with U.S.-imposed sanctions.
Ericsson, for its part, has suffered as a result of a Swedish authority banning telecom operators from using Chinese Huawei hardware and software in key areas of its networks.
In retaliation, Chinese telecom operators have reduced their purchases from Ericsson.
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source https://pledgetimes.com/interim-reports-nokias-share-price-has-risen-56-percent-this-year-and-the-company-may-again-surprise-the-market-based-on-preliminary-data-the-business-has-developed-strongly/
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