Nokia recently announced its first quarter earnings report for 2020. For the first quarter of 2020, Nokia recorded revenue of $ 5.3 billion. This is a decrease of 2% from year to year compared to the revenues of 5.4 billion dollars in the same period last year. In the first quarter of this year, Nokia’s revenue fell short of analysts’ expectations, mainly because the outbreak of a new coronavirus disrupted its supply chain in China. However, strong demand for new 5G telecommunications equipment has helped the company make a small profit. This is some good news for Nokia.
The Finnish company is compete with Huawei and Ericsson. It is trying to boost its 5G business, especially seeing the growth of 5G in the US. Both Ericsson and Huawei saw revenue growth in the first quarter of this year. Nokia is working hard to reduce product costs and delivery delays. The company said that the reduction in product costs is progressing smoothly and shipments of its new 5G ReefShark equipment are increasing.
Ahead of Nokia making the remarks, Ericsson’s competitor said last week that the epidemic was making services more difficult, and that the closure of the city caused by the epidemic and other measures could put Europe far behind in upgrading. of the latest mobile phone technology, although the United States continues to promote its 5G plan.
Nokia reduces the prices of 5G equipment
Nokia is phasing out expensive 5G components that threaten its profitability and competitiveness. In the first three months of this year, new, higher-cost products accounted for about 17% of Nokia 5G product shipments, up from 10% in the previous quarter.
At the same time, Nokia reduced its full-year performance forecast for 2020 because the company had difficulty delivering equipment to customers. The company expects earnings per share to be $ 0.25, compared to previous estimates of $ 0.27. In addition, Nokia expects an operating profit margin of around 9%, compared to previous estimates of 9.5%.