Nokia performed better than expected in the second quarter of 2019.
The Finnish telecom network equipment maker reported a rise in second-quarter profit, driven by end-to-end 5G demand and improved operational execution.
In the April-June period, Nokia reported earnings per share of 0.05 euros.
RAJEEV SURI, PRESIDENT AND CEO, ON Q2 2019 RESULTS
Nokia delivered a strong second quarter, driven by 5G demand, a competitive end-to-end portfolio and strengthened operational execution. Given these compelling results, we are confirming our full-year 2019 guidance.
In the quarter, we saw good year-on-year growth, meaningful improvements in profitability, robust progress in our strategic expansion areas of Software and Enterprise and excellent momentum in our IP Routing business. We also continued to enhance our position in 5G, and now have 45 commercial 5G deals and 9 live networks.
Risks remain in the year, including execution demands in the second half, trade-related uncertainty and challenges in the China market. Given these risks, we will continue to focus on tight operational discipline, delivering on our EUR 700 million cost-savings program, improving working capital management and advancing the implementation of our strategy.
Overall, I am pleased with Nokia’s performance in the second quarter and our continued progress in executing our strategy.
Revenue in the second quarter rose to 5.69 billion euros ($6.34 billion), a 7% rise compared to the year-ago period. Analysts had forecast revenue of 5.43 billion euros, according to Reuters.
According to Rajeev Suri, Nokia President and CEO, the company continued to enhance its position in 5G in the second quarter. It now has 45 commercial 5G deals and 9 live networks.
Suri noted there are some risks that remain in the year, including execution demands in the second half, trade-related uncertainty and challenges in the China market.
“Given these risks, we will continue to focus on tight operational discipline, delivering on our EUR 700 million cost-savings program, improving working capital management and advancing the implementation of our strategy,” Suri said.
Nokia forecasts full-year earnings per share at 0.25-0.29 euros, and 2020 earnings per share of 0.37-0.42 euros.
Nokia’s main rivals are Sweden’s Ericsson and the Chinese telecom giant Huawei. Some analysts believe that the challenged Huawei faces in the US could benefit its Nordic rivals.
US officials have become increasingly concerned that Huawei’s technologies could pose a threat to national security – an allegation that Huawei strongly denies.
“Some customers are reassessing their vendors in light of security concerns, creating near-term pressure to invest in order to secure long-term benefits,” Nokia said.