Nokia claims to return to profit despite drop in sales due to virus pandemic

HELSINKI: Finnish telecommunications gear supplier Nokia stated Friday it had returned to revenue within the second quarter and hiked its 2020 forecasts, regardless of a drop in gross sales because of the coronavirus pandemic.

Web revenue got here in at 94 million euros ($112 million) in comparison with a lack of 193 million euros throughout April-June final yr.

The outcome was nonetheless far beneath the analyst consensus of a revenue of 142 million euros compiled by Factset.

“Nokia delivered a robust enchancment in Q2, with better-than-expected profitability, vital enchancment in money technology, clear indications of a return to power in cell radio, and a year-on-year improve in earnings-per-share, regardless of the challenges of COVID-19,” outgoing CEO Rajeev Suri, who will go away his put up on Saturday, stated in an announcement.

Pekka Lundmark, who till now served as CEO of Finnish vitality firm Fortum, will take over from Suri.

Gross sales fell by 10.6% to five billion euros, with Nokia estimating the influence from the coronavirus pandemic at 300 million euros for the second quarter.

“We count on that almost all of gross sales missed within the quarter because of COVID-19 will shift to future durations,” stated Suri.

The corporate managed to extend its working margin to eight.3% from 7.9% one yr in the past, utilizing a technique that isn’t compliant with worldwide accounting guidelines.

For this yr it now goals to extend this measure to 9.5%, “plus or minus 1.5 proportion factors,” in comparison with an earlier forecast of 9%, with money circulation now clearly optimistic.

In October 2018, the corporate introduced a 700 million euros value financial savings plan, which continues to be ongoing.

Nokia has confronted extra difficulties than its rivals Huawei and Ericsson in establishing itself out there for 5G cell community gear.

It reported signing 83 contracts for 5G community gear.

Sweden’s Ericsson stated earlier this month it had signed a complete of 99 contracts for 5G community gear.

Nokia’s shares had been up greater than 13% in early afternoon buying and selling in Helsinki, the place the market was up 2.1% general.

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