Nokia's net sales surge but operating profit weaker than expected

Information technology company Nokia's net sales grew by 16 percent in the third quarter of this year, but its operating profit remained below market expectations, reported Xinhua.

According to its financial report for the third quarter of 2022 published on Thursday, Nokia's net sales reached 6.24 billion euros, increasing by 16 percent from 5.40 billion euros in the same quarter one year earlier.

Comparable operating profit was 658 million euros, rising by 4 percent on a year-on-year basis.

According to Nokia's Chief Executive Officer (CEO) Pekka Lundmark, the company has seen improvements in competitiveness, a good pace of growth and opportunities in new areas.

"We currently expect growth on a constant currency basis in our addressable markets in 2023," Lundmark said, adding that considering the company's "recent success in new 5G deals in regions like India, which are expected to ramp up strongly in 2023, we believe we are firmly on a path to outperform the market."

However, Nokia's comparable operating margin dropped year-on-year to 10.5 percent from 11.7 percent, as improving profitability in mobile networks and network infrastructure was offset by the timing effects of contract renewals in Nokia Technologies.

As a result, Nokia's shares plunged by more than 9 percent on Nasdaq Helsinki on Thursday afternoon.

The company said that potential threats to its further growth include globally weakened economic prospects and geopolitical risks.