Nokia Says 1Q Net Profit Beat Views But Warns on Supply Constraints -- Update
April 28 2022 - 6:28AM
Dow Jones News
By Dominic Chopping
Nokia Corp. on Thursday posted a forecast-beating first-quarter
net profit as demand for mobile networks remains strong, but
cautioned that supply-chain constraints continued to hurt sales, in
addition to the timing of patent licensing renewals.
The supply situation remains constrained but Nokia said it
expects to deliver sales growth in mobile networks in 2022 due to
improved competitiveness.
Europe and Latin America had good growth in mobile networks,
while sales in North America and greater China declined, it
added.
The company's comparable net profit for the quarter rose to 409
million euros ($433.2 million) from EUR373 million a year earlier.
Sales rose 5.4% to EUR5.35 billion, it said.
Analysts polled by FactSet had expected comparable net profit of
EUR340 million on sales of EUR5.27 billion.
On a reported basis, Nokia posted a net profit of EUR212 million
from EUR261 million a year earlier, it said.
"Overall, 1Q was a strong start for the year both in terms of
net sales and profitability," Chief Executive Pekka Lundmark
said.
"The demand environment remains strong and while supply-chain
and inflation challenges remain, we are confident we can deliver
our 2022 outlook and continue to make good progress toward our
long-term targets," he said.
Nokia backed its 2022 guidance, anticipating sales of EUR22.6
billion to EUR23.8 billion in constant currency and an adjusted
operating margin of 11% to 13.5%. However, adjusting for foreign
exchange, the company lifted its revenue outlook to EUR22.9
billion-EUR24.1 billion.
Earlier this month, Nokia announced its intention to exit the
Russian market and it recorded a EUR104 million provision in the
first quarter in relation to the move.
The company's long-term target is to grow faster than the market
and to achieve a comparable operating margin of at least 14%.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
April 28, 2022 06:13 ET (10:13 GMT)
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