Nokia expects its profitability to develop weaker than expected.
Network devices manufacturer Nokia weakens its assessment of the development of its profitability.
According to the new goal, the operating profit percentage measuring profitability will be at least 13 by 2026, while the previous goal was 14.
The company is also simplifying its operations to better meet customer demand. The independence and responsibility for results of each business group is increased
Key the reason for the decline in profitability is the difficulties with mobile phone networks. The company believes that network infrastructure and cloud and online services will grow faster than the market until 2026.
Instead, the difficulties of mobile phone networks will continue in 2024 and 2025.
“We are updating the strategy of the mobile networks business group so that it can better create value in the medium and long term. The other business groups are making good progress in their goals,” says the CEO Pekka Lundmark in the bulletin.
According to Nokia, the “demand environment” for mobile phone networks will remain weak, as the target market decreased this year and the fast pace of building fifth generation (5g) networks is leveling off in India next year. In addition to this, the largest telecommunications operator in the United States, AT&T, decided to centralize its 5g radio network to Ericsson.
The news is updated.
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