Nokia signs patent licensing deal with Huawei

Nokia just announced that it entered into multiyear patent licensing agreement with Huawei, China’s biggest telecommunication infrastructure and smartphone company. The license is most likely related to phones, but not a lot of details were given in the official press release. Huawei is the 2nd Chinese smartphone manufacturer that accepted Nokia’s license package, after Xiaomi. It’s worth to note that Nokia and Huawei had a patent agreement in the past (2008?), so Nokia has a precedent for making deals with Huawei.

The financial terms are confidential, but we know that Nokia will begin recognizing revenue from Huawei in Q4 this year, including a one-time catch-up payment. We will know the details and how this will affect Nokia’s Financial on February the 1st next year, when Nokia is expected to publish the Q4 2017 and full year 2017 reports. With HMD probably having its best quarter yet (in Q4), and more money from patents, this quarter could be a record breaking for Nokia Technologies.

Nokia and Huawei sign patent license agreement

Espoo, Finland – Nokia today announced that it has signed a multi-year patent license agreement with Huawei.

“Huawei is one of China’s largest companies and is among the world’s leading smartphone manufacturers and we are delighted to welcome them to our family of patent licensees,” said Maria Varsellona, chief legal officer at Nokia.

While details of the license agreement remain confidential, Nokia will follow its existing practices for disclosing patent licensing revenue in its quarterly financial reports and expects that revenue for the agreement will begin to be recognized in the fourth quarter of 2017, including an element of non-recurring catch-up revenue, with additional revenues expected during the term of the agreement.

Source: Nokia

  • EricLovesSymbian

    EricLovesSymbian says:

    What does this mean for us that have no idea what this means?

    Does this mean that Nokia will give some intellectual property to Huawei and get paid for it?
    Or does it mean Nokia will have Huawei make phones for them?
    Or does it mean Nokia will hall Huawei to use Nokia’s legendary methods to make better more durable phones?

    Or is this just a software (or internal hardware) thing?

    Does this mean Nokia will make more money on every Huawei phone sold?

    Or does this mean Nokia phones could be sold alongside Huawei phones in China?

    Since Huawei is trying to penetrate the US market is a very aggressive way, will this mean Nokia is in on the ride as well (with carrier subsidies)?

    Will this benefit Nokia stock prices?

    How does this relate to the 5G rollout that Nokia is trying to implement in 2019?

    This raises so many questions…

    • A lot of questions you have there, and on some on them the upcoming Q4 report could give the answer. I think this deal relates to standard essential and other mobile patents. This means that Nokia will earn money from every Huawei phone sold. 🙂

      • EricLovesSymbian

        EricLovesSymbian says:

        I love it when Nokia makes money!