Nokia posts surprise €59m quarterly loss

HELSINKI: Finnish telecom network equipment maker Nokia yesterday reported a surprise quarterly loss, citing hard competition in its core networks business.

“The slow start to this year and expected weak overall first half puts significant pressure on execution in the second half,” said the company.

Having signalled back in January “a particularly weak first quarter”, Nokia reported a fall to an operating loss (non-international financial reporting standards) of €59 million (RM273.24 million) from a profit of €239 million in the first quarter a year ago.

That compared with analysts’ profit expectations ranging from €175 million to €457 million in a Reuters poll.

Nokia repeated its January forecasts for “flattish” market with earnings per share of €0.25 to €0.29 this year and €0.37 to €0.42 next year.

The networks industry — dominated by Nokia, Sweden’s Ericsson and China’s Huawei Technologies Co Ltd — has been battered by years of slowing demand since 4G network sales peaked in the middle of the decade. It is now readying for a new cycle of upgrades as operators have started to invest in 5G equipment.

Last week, rival Ericsson posted a January to March profit that swept past forecasts due to strong growth in North America and cost cuts.

Some analysts said Nokia and Ericsson might benefit from challenges faced by Huawei after Washington alleged its equipment could be used by Beijing for spying, but Nokia warned the competition could be harsh.