Nokia exceeds expectations and prioritizes networks, 5G and the cloud

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The quarterly results from Nokia have exceeded market expectations and under the leadership of their new director Ejecutivo, Pekka Lundmark, prioritize your business networks, 5G and cloud according Muslim Farooque en Yahoo Finance.

In the third quarter it registered € 633 million in comparable operating profit, which represents a growth of 30% compared to the previous year. Analysts had expected a comparable operating profit of € 522 million.

It also generated net sales of € 5.4 billion, 2.1% more than last year. Sales growth was primarily driven by a 6% and 12% year-on-year improvement in the company’s network infrastructure and in the network and cloud services segments, respectively.

Their gross margins were located in a healthy 40,3% for the quarter, compared to 34.8% last year. It also generated strong free cash flows of 0.7 billion euros.

Nokia has reiterated its sales outlook for the year, falling in the range of 21.7 billion euros to 22.7 billion euros. However, its CEO says it is likely that supply chain problems influence your profitability. Lundmark states that “the uncertainty surrounding the global semiconductor market limits our visibility in Q4 and 2022.” Additionally, the company is working with suppliers to ensure component availability and curb component cost inflation.

Nokia has picked up the pace of late by signing some major 5G contracts. Previously, it was far behind its peers in the 5G race, but now it has become one of the pioneers. It had recently profited from Ericcson’s bad luck in China when Beijing fought back Sweden and banned Huawei.

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In addition, it is expected that mobile networks and the network and cloud services segment Nokia’s growth rapidly for the foreseeable future. The total addressable market for mobile networks is $ 53.4 billion and it could grow by about 5%, excluding China. In addition, the network and cloud services segment market is also in $ 30.2 billion.

Going forward, Nokia believes it will expand its revenue and profits at a faster rate than its competitors until 2023. To do this, it must continue investing in research and development. Furthermore, it is likely that soon restore your dividend, which will make the shares more attractive to new and existing investors. Nokia is forecasting positive free cash flows, supported by strong operating margins.

The firm is currently trading at 5.01 euros and the Ei indicators are mixed.

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