Nokia cuts sales and profit forecast

Nokia trimmed its sales and profit forecast for 2023 blaming a tightening economic landscape for cutting customer budgets.

In a statement, Nokia announced it will lower its net sales outlook from €24.6 billion - €26.2 billion to €23.2 billion - €24.6 billion. Operating margin range had been cut from 11.5% - 14% to 11.5% - 13%.

The Finnish vendor said there is weaker customer demand in H2 due to the “macro-economic environment and customers’ inventory digestion”. Customer budgets have been hit by high inflation and rising interest rates, resulting in some projects being pushed to 2024, particularly in North America. Also being blamed was inventory normalisation from customers after supply chain challenges in the last two years.

Nokia predicted it will report net sales of around €5.7 billion and an operating margin of 11% in Q2. Its operating profit in Q2 benefitted from approximately EUR 80 million related to catch-up net sales in Nokia Technologies.

The vendor stated it has been “proactively managing costs to protect profitability” due to this period of “uncertainty”, to remain on track to growth and an operating margin of 14%.