Nokia Revises Outlook Upwards As Q2 Profit Exceeds Forecast

Nokia Wins Deal With Rakuten Mobile In Japan #MWC24

The Finland-based company, Nokia Corporation reported a second-quarter net income of $414.4 million.

The company said it had a net income of 7 cents per share. Earnings, adjusted for one-time gains and costs, were 11 cents per share.

Key financial highlights

Top-line strength continued in Q2, with constant currency net sales up 9% year-on-year, driven by growth across all business groups, with particular strength in Network Infrastructure. Reported net sales increased 4%.

  • Important progress on our three-phased strategy. Mobile Networks strengthening its competitiveness with major product launch, including some industry leading features. Network Infrastructure continued to gain share in the first half.
  • Our new operating model is delivering clear accountability and financial discipline through the organization.
  • Comparable gross margin of 42.3% (reported 41.0%) in Q2, reflecting broad improvements, particularly in Mobile Networks, which benefitted from a one-time software deal and 5G growth.
  • Comparable operating margin of 12.8% (reported 9.1%) in Q2, with improvements across all business groups, also helped by the one-time software deal in Mobile Networks.
  • Q2 comparable diluted EPS of EUR 0.09; reported diluted EPS of EUR 0.06.
  • Generated positive free cash flow for the fifth quarter in a row; liquidity position remains solid with EUR 3.7bn net cash.
  • Strong performance in first half 2021 with 9% constant currency sales growth (reported net sales +4%) and comparable operating margin of 11.9% (reported 8.8%), driving increase in our full year Outlook although headwinds remain for the second half.
  • Considering our strong start to 2021, we revise our full year 2021 Outlook, including net sales expected to be EUR 21.7bn to 22.7bn (previously EUR 20.6bn to EUR 21.8bn) with comparable operating margin in the range of 10-12% (previously 7-10%).


This is a summary of the Nokia Corporation Financial Report for Q2 and Half Year 2021 published today. Nokia only publishes a summary of its financial reports in stock exchange releases. The summary focuses on Nokia Group’s financial information as well as on Nokia’s outlook. The detailed, segment-level discussion will be available in the complete financial report hosted at Investors should not solely rely on summaries of Nokia’s financial reports, but should also review the complete reports with tables.


I am delighted that our strong start to 2021 continued in the second quarter. Our constant currency sales growth of 9%, combined with good cost control, enabled us to deliver a comparable operating margin of 12.8%. Even excluding a one-time software deal in Mobile Networks, we saw good underlying progress in operating margin. We are already seeing the benefits of our new operating model which helped us to deliver such a strong financial performance.

The highlight of the second quarter was the Mobile Networks launch of our new AirScale baseband and radio products with up to 75% better power efficiency helping to reduce our environmental footprint and the lightest 32TRX massive MIMO active antenna in the market. In Network Infrastructure we sustained double-digit growth and have a series of product launches ahead in the second half to further strengthen our differentiation. Cloud and Network Services is making good progress on its portfolio rebalancing and Nokia Technologies continues to scale with two licensing agreements with automotive manufacturers including Daimler.

Considering our robust start to 2021, we are revising upwards our full year Outlook. We now expect a comparable operating margin between 10-12% for full year 2021, compared to our previous range of 7-10%. We have executed faster than planned on our strategy in the first half which provides us with a good foundation for the full year. We still however expect to face the earlier communicated headwinds in the second half, particularly with market share loss and price erosion in North America. Therefore, we still expect our typical quarterly earnings seasonality to be less pronounced in 2021. In addition, we continue to accelerate R&D investments and monitor risks around component availability, considering the strong demand for our products.

Overall, I am very happy with the progress made in the first half. I want to thank our entire team for their hard work and commitment.


  • Nokia’s outlook assumptions for the comparable operating margin of each business group in 2021 and 2023 are provided below (updated):
 Full year 2021Full year 2023
Mobile Networks4 to 7%5 to 8%
Network Infrastructure8 to 11%9 to 12%
Cloud and Network Services3 to 6%8 to 11%
Nokia Technologies>75%>75%
  • We continue to maintain our expectation for Nokia Technologies to deliver a slight improvement in comparable operating profit in full year 2021, relative to full year 2020, and stable performance over the longer-term;
  • Group Common and Other primarily consists of support function costs. We expect the net negative impact of Group Common and Other to be approximately EUR 200 million in 2021 and over the longer-term;
  • In full year 2021, Nokia expects the free cash flow performance of Nokia Technologies to be approximately EUR 600 million lower than its operating profit, primarily due to prepayments we received from certain licensees;
  • Comparable financial income and expenses are expected to be an expense of approximately EUR 200 million in full year 2021 and EUR 250 million over the longer-term (updated);
  • Comparable income tax expenses are expected to be approximately EUR 450 million in full year 2021 and over the longer-term, subject to regional profit mix, net sales subject to withholding tax and the timing of patent licensing cash flow;
  • Cash outflows related to income taxes are expected to be approximately EUR 350 million in full year 2021 and over the longer-term until our US or Finnish deferred tax assets are fully utilized;
  • Capital expenditures are expected to be approximately EUR 650 million in full year 2021 and EUR 600 million over the longer-term (updated); and
  • Rule of thumb related to currency fluctuations: Assuming our current mix of net sales and total costs (refer to Note 1, Basis of Preparation, in the Financial statement information section included in Nokia Corporation Financial Report for Q2 and Half Year 2021 for details), we expect that a 10% increase in the EUR/USD exchange rate would have an impact of approximately negative 4 to 5% on net sales and an approximately neutral impact on operating profit.