Nokia reports mixed Q1 results amid growth efforts

Published 24/04/2025, 06:06
Nokia reports mixed Q1 results amid growth efforts

ESPOO - Nokia Oyj (HE:NOKIA) reported a mixed first quarter for 2025, with overall revenue declining by 3% compared to the same period last year when adjusted for currency fluctuations and current company structure, according to a statement released today. The company’s network infrastructure group saw a robust 11% growth, while mobile networks revenue increased by 2%.

The integration of Infinera (NASDAQ:INFN), which Nokia acquired in the first quarter, is underway, with significant decisions made regarding the product portfolio. This acquisition is intended to strengthen Nokia’s position in the Optical Networks business and among hyperscale operators. Infinera contributed to a strong order backlog during the quarter.

However, Nokia’s comparable gross margin decreased by 8.2 percentage points year-over-year to 42.3%, with half of the decline resulting from a decrease in revenue from the Technology business group. The mobile networks segment was impacted by a one-time charge of 120 million euros related to a settlement agreement.

The comparable operating profit margin fell by 9.9 percentage points from the previous year to 3.6%, mainly due to lower gross margin and increased operating expenses from investments aimed at long-term growth.

Nokia’s comparable diluted earnings per share (EPS) for the quarter were 0.03 euros, while the reported diluted EPS was -0.01 euros. The company’s free cash flow stood at 0.7 billion euros, with net cash reaching 3.0 billion euros.

Despite the challenges, the network infrastructure business, including the newly integrated Optical Networks unit, performed strongly, with revenue up 15% and significant new contracts, particularly with hyperscale operators.

Nokia maintains its outlook for 2025, expecting a comparable operating profit of 1.9–2.4 billion euros and a free cash flow representing 50–80% of comparable operating profit.

The company completed a share buyback program on April 2, 2025, repurchasing 150 million shares at an average price of approximately 4.69 euros per share, reducing its free equity by around 703 million euros. The shares were subsequently canceled on April 23, 2025.

Nokia’s CEO Justin Hotard, who took the helm three weeks ago, is focusing on efficiently allocating resources to improve performance and invest in growth areas for long-term shareholder value. The company remains cautious about the potential short-term disruptions from tariffs but is leveraging its global production network to minimize their impact.

This article is based on a press release statement from Nokia Oyj.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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