Wireless and fixed-network equipment maker Nokia reported a smaller-than-expected profit and a double-digit fall in sales in the first quarter of the year. The company's net profit for the January-March period was 501 million euros, up 46% from the previous year but still lower than analysts' expectations. This increase was partly due to one-off gains from Nokia's licensing business. Net income attributable to shareholders also saw a rise to 497 million euros.
Nokia's sales were down by 20% at 4.7 billion euros, reflecting the ongoing weakness in the telecom equipment market. The market has been affected by a lack of client investments in 5G technology, driven by economic uncertainty and high financing costs. The company's CEO, Pekka Lundmark, acknowledged the challenging market conditions but expressed confidence in a stronger second half of the year and meeting the full-year outlook.
Nokia is a key player in the 5G technology space, competing with other major suppliers like Ericsson, Huawei, and Samsung. Despite the market difficulties, Nokia expects its Network Infrastructure unit to return to net sales growth by the end of 2024, with a more robust performance in the second half of the year. The mobile network unit, Nokia's second-largest business entity, faced reduced spending on 5G technology in North America and India during the first quarter.
