Nokia's Struggling Networks Business Just Sent Its Stock Plunging

Nokia Nokia Q3 results Chinese smartphones wireless charging Huawei Ericsson telecom network equipment industry Nokia network sales T-Mobile Sprint 5G technology 3G and 4G networks Alcatel-Lucent Ericsson Alcatel-Lucent Microsoft Nokia phon

(NOK) were losing around 15 percent in the mid-day trading in Finland after the network company reported Thursday wider net loss in its third quarter and decline in Networks' sales. Loss per share widened to 0.03 euros from 0.02 euros past year.

The improvement in underlying results prompted the company to increase its dividend for the year.

Reuters reported in May that Nokia was planning to sell the ASN division, which is one of the top suppliers of undersea cable networks in the world and is valued at 800 million euros ($944 million).

Chief Executive Rajeev Suri said the performance of its patent-licensing business was the clear highlight of the quarter.

The company's adjusted non-IFRS net profit rose to EUR514 million from EUR258 million, it said.

He said Nokia estimated the continued decline to be in the 2-5% range.

Nokia Technologies' net sales climbed 37 percent primarily related to a settled arbitration in the third quarter 2017. Operating margin of 6.9% reflected weak results in Ultra Broadband Networks, which was partially offset by improved year-on-year performance in Global Services and IP Networks and Applications.

Net sales for the quarter declined 7 percent to 5.5 billion euros from 5.90 billion euros a year ago. The margin growth was driven by Nokia Technologies and resilience in Nokia's Networks business. On a constant currency basis, Nokia net sales would have decreased 4 percent.

Net sales fell 7 percent year-on-year to Euro 5.54 billion and were down 4 percent at constant exchange rates.

Nokia's network sales fell 9 percent in the third quarter to 4.8 billion euros ($5.7 billion) while operating profit in the business dropped 23 percent to 334 million.

"The decrease in Mobile Networks net sales was primarily due to radio networks, reflecting challenges related to market conditions and certain projects". For the 9 months period of 2017 Nokia's total sales recorded were 16496 million Euro whereas it was 16984 million Euro for the same period for the previous fiscal year.

Solid Q3 2017 gross margin of 38.6% supported by continued operational discipline.

Related:

Comments

Latest news

Are Analysts Turning Critical? - Mattel, Inc. (MAT), General Mills, Inc. (GIS)
Waldron LP purchased a new stake in General Mills during the first quarter worth about $420,000. (NYSE: GIS ) for 31,273 shares. It also upped Scorpio Tankers Inc Shs (NYSE:STNG) stake by 131,700 shares and now owns 558,100 shares.

Ford beats on earnings, raises the lower end of its forecast
Ford plans to introduce 13 new electrics and hybrids over the next five years, including a small electric SUV coming in 2020. Adjusted pretax profit rose almost 40%, from $1.41 billion in the third quarter of 2016 to $1.97 billion.

BSE Sensex closes above psychological 33000-mark for the first time
At 0620 GMT, the S&P BSE Sensex fell 0.05 percent at 33,026 while the broader NSE Nifty rose 0.12 percent to 10,307. Even the private counterparts such as ICICI Bank and Axis Bank saw their stocks soar up to 15%.

India thrash U.S. 22-0 in Sultan of Johor Cup 2017
The senior team remained unbeaten in their Asia Cup campaign and won the title with 2-1 win over Malaysia in the final on Sunday. The boys who have made India proud made sure that the country registered its second biggest win in worldwide hockey.

HSBC Holdings plc (HSBA) Rating Reiterated by Deutsche Bank AG
Panmure Gordon now has a GBX 470.00 target price per share on the 323.73 million GBP market cap company or 9.94% upside potential. In related news, insider Jonathan Symonds acquired 10,000 shares of the firm's stock in a transaction on Tuesday, August 1st.

Other news