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Investing.com -- Nokia’s (NYSE:NOK) U.S.-listed shares tumbled 8% in premarket trading Thursday after the Finnish company warned of a second-quarter earnings hit from trade tariffs, after posting a net loss in the first quarter due to a one-off charge in its mobile networks division.
Nokia (HE:NOKIA) shares in Helsinki were also down 8.5% as of 08:26 GMT.
The company said the unexpected charge makes reaching the upper end of its full-year guidance more difficult, though it maintained its target for comparable operating profit between €1.9 billion and €2.4 billion.
The anticipated Q2 impact from tariffs is estimated at €20 million to €30 million, primarily due to potential supply chain disruptions. CEO Justin Hotard said no demand issues have emerged so far, and early customer feedback suggests resilience across key markets.
"Regarding the tariff situation, there could be some short-term disruption. We will continue to utilize the flexibility of our global manufacturing network to minimize impact of the evolving tariff landscape," Hotard said in the earnings release.
Hotard also noted strong order momentum from the recently acquired Infinera (NASDAQ:INFN), particularly among hyperscale cloud providers, signaling long-term growth potential in that segment.
For the first quarter, Nokia reported a net loss of €60 million, reversing a €438 million profit a year earlier. Revenue slipped 1% to €4.39 billion, missing analyst expectations of €4.44 billion.
Comparable operating profit dropped 74% to €156 million, well below the €300 million forecast.
The earnings miss was driven by a €120 million contract settlement related to a 2019 mobile networks project.
Meanwhile, Nokia’s network infrastructure unit posted solid growth, with sales rising 11% on an adjusted basis.
Commenting on the print, Morgan Stanley (NYSE:MS) analysts said they expect Nokia shares "to underperform on the Q1 miss."