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Nokia Q3 2017 results: Nokia Technologies drives strong profit growth.

Nokia has today made its Q3 2017 Earnings report public. The Q3 2017 highlight is Nokia Technologies registering big boost in both sales and profitability.

Nokia Technologies has seen 37% year-on-year net sales increase and 73% year-on-year operating profit increase in Q3 2017, primarily due to higher patent and brand licensing income. Overall sales however saw a decrease of 7% year-on-year (4% decrease on a constant currency basis). The net sales was EUR 5.5bn in Q3 2017.

Nokia Networks reported a 9% year-on-year net sales decrease (6% decrease on a constant currency basis) with solid gross margin of 38.6%.

Here are the Nokia Q3 2017 results highlights,

FINANCIAL HIGHLIGHTS

  • Non-IFRS net sales in Q3 2017 of EUR 5.5bn (EUR 6.0bn in Q3 2016). Reported net sales in Q3 2017 of EUR 5.5bn (EUR 5.9bn in Q3 2016). 7% year-on-year net sales decrease (4% decrease on a constant currency basis) in Q3 2017, on both a non-IFRS and reported basis.
  • Strong non-IFRS gross margin of 42.7% (40.0% in Q3 2016), and non-IFRS operating margin of 12.1% (9.3% in Q3 2016), driven by Nokia Technologies and resilience in Nokia’s Networks business. Reported gross margin of 39.7% (37.9% in Q3 2016) and reported operating margin of negative 4.2% (positive 0.9% in Q3 2016).
  • Non-IFRS diluted EPS in Q3 2017 of EUR 0.09 (EUR 0.04 in Q3 2016) benefited from a lower than expected non-IFRS tax rate of 15%. Reported diluted EPS in Q3 2017 of negative EUR 0.03 (negative EUR 0.02 in Q3 2016).
  • Given the strong year-on-year group-level performance with both gross and operating margins up significantly and continued momentum in the execution of our strategy, Nokia’s Board of Directors plans to propose a dividend of EUR 0.19 per share for 2017 (EUR 0.17 for 2016).

Nokia’s Networks business

  • 9% year-on-year net sales decrease (6% decrease on a constant currency basis) in Q3 2017, primarily due to Ultra Broadband Networks, reflecting challenges related to market conditions and certain projects in Mobile Networks, primarily in North America and Greater China.
  • In Q3 2017, on a constant currency basis, the year-on-year net sales performance in IP Networks and Applications and Global Services improved, when compared to the year-on-year performance in Q2 2017. On a constant currency basis, year-on-year net sales grew by 2% in both Global Services and IP Routing.
  • Solid Q3 2017 gross margin of 38.6% supported by continued operational discipline. Operating margin of 6.9% reflected weak results in Ultra Broadband Networks, which was partially offset by improved year-on-year performance in Global Services and IP Networks and Applications.

Nokia Technologies

  • 37% year-on-year net sales increase and 73% year-on-year operating profit increase in Q3 2017, primarily related to a settled arbitration in the third quarter 2017. Approximately EUR 180 million of the net sales were non-recurring in nature and related to catch-up net sales for prior periods. With fast and effective execution against our patent licensing strategy, we have approximately doubled our recurring license revenue from EUR 578 million in 2014.

Source: Nokia

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Nayan

Nayan has more than 10 years of experience of covering Technology and innovations. He is a big Nokia fan and Tech disruptions aficionado. He loves to review new cool gadgets and writing about Android, iOS, Gadgets and general Technology stuff. He has been associated with other well-known Tech sites WinCentral and GadgetOx since long.

He currently sports a Lumia 950 XL and Nexus 5X. Other interests include listening to Nu-Metal Hits and Kick-Boxing.
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