Nokia Struggles with Weak Market in Q1 Despite CEO’s Optimism

During the first quarter of the year, Nokia, a wireless and fixed-network equipment manufacturer based in Espoo, Finland, reported lower-than-expected profits and a significant double-digit decline in sales. The weakened market was due to clients’ lack of investment in 5G technology. Despite this, CEO Pekka Lundmark expressed confidence in a stronger second half of the year and achieving the full-year outlook.

Nokia’s net profit for the January-March period was 501 million euros, up 46% from the previous year but still below analysts’ expectations. One-off gains from Nokia’s licensing business contributed to the profit, with sales dropping by 20% to 4.7 billion euros. Lundmark acknowledged the ongoing weakness in the telecom equipment market where operators are cutting back on investments in 5G and other technologies due to economic uncertainty and high financing costs.

Despite this, Lundmark highlighted the order intake strength and expressed expectations for net sales growth in the Network Infrastructure unit for the full year, with a stronger performance in the second half. The company’s mobile network unit was affected by low spending on 5G technology in North America and India during the first quarter. However, Lundmark remains optimistic about a better performance in the coming months and achieving the company’s full-year goals.

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