One thing I have always liked about Nokia, as a person who likes financial stuff, is the transparent and detailed financial reporting that the company does. In some cases in Nokia’s history, there were times public and fans wanted to know more about some business result, and Nokia refused to provide that info. To be precise, that was the case with the sales figures of Nokia N9 and Nokia 808. By comparing Nokia’s way of reporting to other companies in the sector, it’s easy to conclude that Nokia is very transparent.
This week Nokia announced a new financial reporting structure, basically dividing the “Networks” business into three segments:
Ultra Broadband Networks, comprised of the Mobile Networks and Fixed Networks business groups.
Global Services, comprised of the Global Services business group.
IP Networks and Applications, comprised of the IP/Optical Networks and Applications & Analytics business groups.
As before, Nokia Technologies remain to be reported as a standalone part inside Nokia.
To provide investors and analysts a better way to inspect Nokia’s upcoming Q2 results scheduled for 27th July, Nokia provided the financial results for Q1 and full 2016 in the new reporting scheme. The full report can be found here. Down below you can take a look at some key Financial figures for Q1 2017 and Q2 2016, because these two quarters will be compared to the Q2 2017 results we’ll see on the 27th.
Results for Q1 2017:
Net sales: €5.378 billion
Networks total: €4.902 billion
Ultra Broadband: €2.236 billion
Global Services: €1.361 billion
IP Networks: €1.304 billion
Technologies: €247 million
Operating profit: (-)€127 million
Networks: €324 million
Ultra Broadband: €245 million
Global Services: €55 million
IP Networks: €23 million
Technologies: €116 million
Other selling, general and administrative expenses (mainly related to Alcatel-Lucent acquisition): €781 million
Results for Q2 2016:
Net sales: €5.576 billion
Networks total: €5.222 billion
Ultra Broadband: €2.356 billion
Global Services: €1.444 billion
IP Networks: €1.421 billion
Technologies: €194 million
Operating profit: (-)€760 million
Networks: €313 million
Ultra Broadband: €184 million
Global Services: €34 million
IP Networks: €95 million
Technologies: €89 million
Other selling, general and administrative expenses (mainly related to Alcatel-Lucent acquisition): €765 million
The segment of Nokia we are most interested in is Nokia Technologies. Now under the lead of Gregory Lee, the business is responsible for Nokia OZO, Nokia Health, Patents and Brand Partnership. Under brand partnership are included HMD’s royalties for use of the Nokia brand and patents on smartphones. HMD does not need to pay the brand license for feature phones, because they acquired it from Microsoft. We could also find out in the upcoming report how much money will Nokia get from the patent deal signed with Apple. And maybe some insight of the recently announced partnership with Xiaomi.