Shares of Nokia Corp. (NOK) were losing around 6 percent in the morning trading in Finland after the Finnish critical networks and communications company Thursday maintained its fiscal 2022 outlook for net sales in constant currency, as well as comparable operating margin towards the mid-point of expected range.
In its third quarter, comparable operating margin was weak mainly due to the decline in Nokia Technologies, while net profit and net sales increased.
For fiscal 2022, on a reported basis, net sales are now expected to be 23.9 billion euros to 25.1 billion euros, compared to previously expected net sales between 23.5 billion euros and 24.7 billion euros.
Nokia continues to expect comparable operating margin at 11 percent to 13.5 percent.
The company said it continues tracking towards the high-end of net sales guidance for 2022 and towards the mid-point of operating margin guidance.
Beyond 2022, Pekka Lundmark, President And CEO, said, “…we currently expect growth on a constant currency basis in our addressable markets in 2023. Considering our recent success in new 5G deals in regions like India which are expected to ramp up strongly in 2023, we believe we are firmly on a path to outperform the market and to make progress towards achieving our long-term margin targets.”
In its third quarter, profit climbed 22 percent to 428 million euros from last year’s 351 million euros. Earnings per share were 0.08 euro, up 33 percent from 0.06 euro a year ago.
Comparable profit for the period was 551 million euros or 0.10 euro per share, compared to last year’s 463 million euros or 0.08 euro per share.
Operating margin declined 100 basis points from last year to 8.3 percent and gross margin fell 60 basis points to 40.1 percent.
Net sales grew 16 percent to 6.24 billion euros from 5.40 billion euros a year ago. Net sales increased 6 percent at constant currency rates as supply constraints started to ease .
Mobile Networks grew 12 percent, due to continued strong demand and supply constraints easing. Sales in Network Infrastructure increased 5 percent with robust demand. Cloud and Network Services declined 3 percent, and Nokia Technologies fell 19 percent, still impacted by expired licenses that are in litigation/pending renewal.
In the quarter, Enterprise net sales grew 32 percent with notable strength in private wireless.
In Finland, Nokia shares were trading at 4.46 euros, down 6.1 percent.
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