Strong Q4 Finishes Great Financial Year for Nokia

Strong Q4 Finishes Great Financial Year for Nokia

In the fourth quarter of 2022, Nokia reported a rise in sales and profits. The full financial year 2022 also ended positively for the Finnish company with gains in all segments.

Net sales in 4Q22 grew 16% year-on-year to €7.4 billion. Nokia’s network infrastructure unit grew by 14% due to acceleration in optical networks and IP. Mobile networks saw a 3% rise due to a shift in regional mix, as a business in India grew on the back of 5G rollouts, while cloud and network services grew 5%. The biggest revenue rise came in its technologies division, which grew 82%. Enterprise sales were also strong, growing 49%. Net profit grew 364% to €3.2 billion. In 2022, Nokia’s net sales grew 12% to €24.9 billion, as its gross margin jumped 120 bps to 41.0%. Operating profit rose 7% to €2.3 billion while operating margin slipped 40 bps to 9.3%. Profit in 2022 jumped 159% to €2.48 billion.

Announcing the results, Nokia CEO Pekka Lundmark was positive on the outlook for 2023: “Looking forward to 2023, while we are mindful of the uncertain economic outlook, demand remains robust. We expect another year of growth and we are targeting full-year net sales of between €24.9 billion and €26.5 billion which implies between 2% and 8% growth in constant currency. We are also targeting a comparable operating margin in the range of 11.5% to 14.0%. Whilst this growth means we have another year of working capital build constraining our free cash flow conversion from comparable operating profit to a range of 20% to 50%, we expect significantly stronger cash flow in 2024. Due to our confidence in our long-term outlook and strong balance sheet position, the Board is proposing an increase in the dividend to €0.12 per share.“