Fannie Mae, Freddie Mac shares tumble after conservatorship comments
Investing.com - Helsinki-listed shares in Nokia (HE:NOKIA) fell by 7% on Wednesday after the Finnish telecoms group slashed its annual income outlook due to tariff-fueled headwinds and recent weakness in the U.S. dollar.
Although sales in its key North American market have been growing steadily, Nokia has been grappling with sweeping U.S. levies which threaten to lead many clients and customers to rein in spending.
"Considering currency and tariff headwinds, which are outside its control and have transpired since its Q1 results, the company feels it is prudent at this point to lower its operating profit outlook range," Nokia said in a statement.
In a statement after the close of European markets on Tuesday, Nokia cut its comparable operating profit guidance range to 1.6 billion euros to 2.1 billion euros, down from a prior estimate of 1.9 billion euros to 2.4 billion euros.
The network equipment manufacturer added that tariffs would dent the outlook by 50 million euros to 80 million euros, while currency fluctuations, especially in the guise of a faltering greenback, would impact results by around 230 million euros. Nokia flagged that the new guidance was based on a euro exchange rate of $1.17, versus $1.04 used previously in January.
Meanwhile, Nokia reported preliminary second-quarter comparable operating profit of 300 million euros on net sales of 4.55 billion. Analysts at Jefferies said this represents an operating margin of 6.6% for the quarter.
Consensus estimates had called for a margin of 8.4% and revenue of 4.81 billion euros. Nokia’s full results are expected to be released on Thursday.
"While the currency and tariff hit is understandable, we believe the underlying business itself is also relatively sluggish at present," the Jefferies analysts said.