Nokia published this morning their quarterly financial report for the 1st quarter of 2020. The Finnish network infrastructure giant saw overall margin improvements as product cost reduction related efforts gave result.
In Q1 2020, the company had net sales of 4.913 billion euro, which is a 2% decline year-over-year, and a miss from the average analyst estimate of 5.1 billion euro. The earning per share (non-IFRS) were 1 eurocent, with the market expectations being 0 or few negative cents per share. The reported non-IFRS profit for the period was 33 million euro, but when you include cost of the acquisition and integration of Alcatel-Lucent, goodwill impairment chargers and other chargers excluded from non-IFRS reporting, Nokia posted a loss of 100 million euro in Q1 2020, which is a lot less from the 442 million euro loss a year ago.
Geographically, Nokia saw the biggest net sales decline in Greater China (-29%), and smaller declines in Latin America (-7%), Europe (-3%) and Asia-Pacific (-1%). Markets where Nokia grew its net sales compared to Q1 2019 are North America (3%) and Middle East and Africa (9%). Majority of Nokia’s customers are communication service providers, but Nokia also took up more enterprise customers compared to last year’s Q1.
Regarding Nokia Technologies, Nokia’s division responsible for patent and brand licensing, it saw a slight decline in net sales and profits compared to Q1 2019. An interesting tidbit from the report is the reason for the decline – lower one-time net sales (which happens regularly because of the way patent licensing deals are made) and lower brand licensing net sales, which means less money received for the Nokia brand compared to Q1 2019.