HELSINKI (AP) — Wireless and fixed-network equipment maker Nokia reported double-digit declines in second-quarter profit and sales on Thursday as the market remained weak as customers delayed investments in 5G technology.
The Espoo, Finland-based company reported net profit of 328 million euros ($359 million) for the April-June period, down 20% from 409 million euros ($447 million) a year earlier. Net profit attributable to shareholders was 325 million euros ($355 million), down from 410 million euros a year earlier.
Like its Nordic rival Ericsson in Sweden, Nokia suffered last year from reduced operator investment in 5G and other telecom technologies due to economic uncertainty and high financing costs.
“Our financial results in the second quarter continued to be impacted by continued market weakness, with revenue down 18 percent compared to the prior year at constant exchange rates,” Nokia CEO Pekka Lundmark said in a statement. Nokia’s sales fell 18 percent to 4.5 billion euros ($4.9 billion), from 5.4 billion euros ($5.9 billion) a year earlier.
The Finnish company is one of the world’s leading suppliers of 5G, the latest generation of broadband technology, alongside Ericsson, China’s Huawei and South Korea’s Samsung. Lundmark said the company’s sales are expected to improve in the second half of this year, particularly in its network infrastructure division.
“Looking ahead, we believe the industry is stabilizing and, given the order intake seen in recent quarters, we expect net sales growth to accelerate significantly in the second half of the year,” he said.
However, at Nokia’s mobile network unit, the largest business unit in the quarter by sales, “market dynamics remain challenging as operators continue to be cautious” about spending on 5G technology and equipment, Lundmark said.
