Sony Pixel Power calrec Sony

Nokia Corporation Financial Report for Q2 and Half Year 2020

01/08/2020

Nokia Corporation Financial Report for Q2 and Half Year 2020

Nokia Corporation

Half year report

July 31, 2020 at 08:00 (CET 1)

Nokia Corporation Financial Report for Q2 and Half Year 2020

Continued improved execution drives strong margin and cash performance

Strong margin expansion, primarily driven by Mobile Access

Clear roadmap progress, particularly related to our 5G mid-band portfolio

Confidence in resilient customer base and strong liquidity position

11% decrease in net sales, largely driven by COVID-19 and China

Strong growth in Nokia Enterprise

Positive operating profit, on a reported basis, in both Q2 and half year 2020

Within previously provided Outlook ranges for full year 2020, adjusted the non-IFRS mid-points for EPS to EUR 0.25 and operating margin to 9.5%

Delivered strong free cash flow year-to-date and raised 2020 recurring free cash flow guidance to be clearly positive

This is a summary of the Nokia Corporation financial report for Q2 and half year 2020 published today. The complete financial report for Q2 and half year 2020 with tables is available at www.nokia.com/financials. Investors should not rely on summaries of our financial reports only, but should review the complete financial reports with tables.

RAJEEV SURI, PRESIDENT AND CEO, ON Q2 2020 RESULTS

Nokia delivered a strong improvement in Q2, with better-than-expected profitability, significant improvement in cash generation, clear indications of a return to strength in mobile radio, and a year-on-year increase in earnings-per-share, despite the challenges of COVID-19. These results show that our execution has improved as planned and that we are well positioned to end the year with a significantly stronger financial position. As a result, we are adjusting upward both the midpoint of our full-year 2020 non-IFRS EPS and operating margin guidance within our previously disclosed outlook ranges.

Profitability gains in the quarter were supported by a 4.5 percentage point year-on-year improvement in Networks gross margin, building on a 3.5 percentage point gain in the first quarter, and driving Nokia non-IFRS gross margin to 39.6%. Nokia Enterprise also grew year-on-year constant currency sales by 18% compared to one year ago and expanded margins.

Nokia-level revenue was down in the quarter, with the majority of that the result of COVID-19 as well as a sharp decline in China based on the prudent approach we have taken in that market. We also saw a reduction driven by our proactive steps to reduce the volume of low margin services business. We expect that the majority of sales missed in the quarter due to COVID-19 will shift to future periods.

At the start of the year, we said we would have a sharp focus on our Mobile Access business and improving cash generation. In both areas we continue to make good progress. Free cash flow in the quarter was positive 265 million, versus negative 1.0 billion one year ago, and Nokia ended Q2 with 1.6 billion of net cash, and 7.5 billion in total cash. Given our strong first-half improvement, we now expect free cash flow for full-year 2020 to be clearly positive compared to our earlier guidance of positive .

In Mobile Access, we saw healthy improvements in our radio portfolio, where roadmaps are strengthening, costs are coming down, and product performance is rising. We have a particularly powerful portfolio in mid-band mobile radio, with proven products deployed with 55 customers, and the first live C-Band network demonstrated in the U.S. during the quarter. Pleasingly, our 5G Powered by ReefShark shipments continue to increase and we believe we remain on track to reach 35% or better by year end. And, we now have 83 5G deals.

Our continued momentum was demonstrated by the progress we announced after the quarter ended. These included the availability of a software upgrade that allows millions of Nokia 4G/LTE radios deployed to more than 350 customers to be migrated seamlessly to 5G; and plans to accelerate leadership in Open RAN. Nokia is the only global supplier fully committed to O-RAN with commercial 5G Cloud-RAN networks. We also announced an expansion of our IP routing business into the data center market and highlighted that Apple was deploying our technology at its data centers.

This is my last quarterly announcement as CEO of Nokia and I want to close with a note of thanks: thanks to our shareholders, thanks to our customers, thanks to our many other stakeholders, and a particular thanks to the great employees of Nokia. You have constantly made me proud and I expect that you will continue to do so in the many years to come. Thank you all. It has been a pleasure and an honor.

NOKIA FINANCIAL RESULTS

EUR million (except for EPS in EUR) Q220 Q219 YoY change Constant currency YoY change Q1-Q220 Q1-Q219 YoY change Constant currency YoY change

Net sales 5 092 5 694 (11)% (11)% 10 005 10 726 (7)% (7)%

Networks 3 955 4 393 (10)% (10)% 7 713 8 336 (7)% (8)%

Nokia Software 597 678 (12)% (12)% 1 210 1 221 (1)% (1)%

Nokia Technologies 341 383 (11)% (11)% 689 753 (8)% (9)%

Group Common and Other 210 263 (20)% (21)% 415 484 (14)% (15)%

Non-IFRS exclusions (1) (2) (1) (27)

Eliminations (11) (21) (20) (41)

Gross profit 2 006 2 065 (3)% 3 784 3 646 4%

Operating profit/(loss) 170 (57) 94 (581)

Networks 249 119 109% 169 (135)

Nokia Software 88 137 (36)% 159 130 22%

Nokia Technologies 282 324 (13)% 572 626 (9)%

Group Common and Other (197) (129) (361) (230)

Non-IFRS exclusions (253) (508) (445) (972)

Operating margin % 3.3% (1.0)% 430bps 0.9% (5.4)% 630bps

Net sales (non-IFRS) 5 093 5 696 (11)% (11)% 10 007 10 753 (7)% (7)
LINK: https://www.nokia.com/about-us/news/releases/2020/07/31/nokia-corporat...
See more stories from nokia

Most recent headlines

05/01/2027

Worlds first 802.15.4ab-UWB chip verified by Calterah and Rohde & Schwarz to be demoed at CES 2026

Worlds first 802.15.4ab-UWB chip verified by Calterah and Rohde & Schwarz to be ...

07/10/2026

Dalet Flex LTS Delivers Smarter Media Operations from Ingest to Distribution

Dalet, a leading technology and service provider for media-rich organizations, today announced the latest Long-Term Supported (LTS) release of Dalet Flex. Build...

06/09/2026

Dolby and MagentaTV Bring Fans Closer to the FIFA World Cup 2026 in Germany with Dolby Vision and Dolby Atmos

June 9 2026, 23:00 (PDT) Dolby and MagentaTV Bring Fans Closer to the FIFA Worl...

02/09/2026

AgileTV and Fiend MTS Complete CDN Watermarking Integration to Fast-Track Anti-Piracy Protection for Operators

Bilbao - 3rd September 2026 -AgileTV, a leading provider of end-to-end TV and vi...

02/09/2026

Agentic AI in the content supply chain

Why agentic media supply chains need experience design built around visibility, reversibility and human authority When AI can generate a functional interface ...

02/09/2026

Gracenote study: 85% of sports fans want TV home screens to show when and where to watch favorite teams

Six-country survey finds 26% of sports fans frequently unable to determine where...

02/09/2026

Manfrotto Showcases New Video Support Solutions at IBC 2026

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

Mediagenix Rebrands Spideo as Mediagenix Curation

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

Creative Technology Group Founder Graham Andrews Sets Year-End Exit

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

San Antonio Spurs, DAZN Ink Exclusive Streaming Deal

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

DPA Launches 6388 CORE Headset Microphone With Shifted Ac...

KOKKEDAL, DENMARK, SEPTEMBER 1, 2026 DPA Microphones announces its new 6388 CORE Headset Microphone, a high-performance directional headset designed for dema...

02/09/2026

Pliant Technologies Spotlights CrewCom CXD 32CF Dante AES...

Pliant Technologies will highlight its CrewCom CXD 32CF 32x32 Dante /AES67 Digital Audio Network Interface, a powerful connectivity solution designed to expand ...

02/09/2026

iWedia Enhances Teatro Pulse with Edge AI Self-Healing an...

iWedia, a leading provider of software solutions for connected TV devices, today announced two enhancements to Teatro Pulse, its end-to-end TV service operation...

02/09/2026

Signiant Accelerates More Than File Transfers at IBC2026

Signiant, trusted by the media industry for accelerated content movement for more than 20 years, will showcase the latest evolution of the Signiant Platform at ...

02/09/2026

Calrec Argo M Powers Cloudbass Next Generation OB Fleet

With a contractual agreement to supply a leading UK sports broadcaster with outside broadcast services for 104 football matches per season over the next four ye...

02/09/2026

IBC2026 puts sport at the winning end of media innovation

IBC2026 will put sport firmly at the centre of the global media and entertainment technology conversation with the strongest sports showing in the event's h...

02/09/2026

PTZOptics Demonstrates the Power of Intelligent Multicame...

PTZOptics will bring a hands-on showcase of intelligent video production to IBC2026 (11-14 September, RAI Amsterdam), with demonstrations spanning new camera te...

02/09/2026

OOONA Launches OOONA Go

OOONA, a global provider of professional management and production tools for the media localization industry, today announced the launch of OOONA Go, a ready-to...

02/09/2026

EON Media launches AI media activation and monetization s...

EON Media will make its European debut at IBC2026 (September 11-14, RAI Amsterdam) in the show's Future Tech Zone (Hall 14.FT5). The company is launching it...

02/09/2026

Frequency Defines the Intelligent Channel at IBC2026

Frequency, the engine behind many of the worlds leading streaming television channels, will demonstrate at IBC2026 how integrating intelligence throughout chann...

02/09/2026

FOR-A Introduces Go Vertical AiDi and AiDi Sports Hub Und...

On-device AI platform gives broadcasters and content creators purpose-built tools for real-time vertical video production and AI-enhanced sports coverage...

02/09/2026

Shotoku To Introduce Aura E2 PTZ Elevator At IBC2026

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

AJA to Launch New openGear SDI/Fiber Conversion Cards at IBC2026

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

GoPro to Merge with Starman Optical

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

AIMS, EBU Completes Latest IPMX Certification Testing

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

EVS To Showcase New Neuron 4X Processor At IBC 2026

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

Sony Launches 100+ FAST Channels on Playstation 5 in the U.S.

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

Canon Unveils PTZ Camera Firmware Updates

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

EverPass Media Expands NFL Offering with Netflix Deal

Share Copy link Facebook X Linkedin Bluesky Email...

02/09/2026

Imagine Communications Unveils Latest Control Portfolio A...

Next-Generation Freeform Control Surfaces Lay the Foundation for AI-Enabled Media Operations At IBC2026 (Sept. 11 14, RAI Amsterdam, Stand #1.B73), Imagine Com...

02/09/2026

Friedrichstadt-Palast Relies on Riedel for IP-Centered Pr...

Friedrichstadt-Palast in Berlin, the world's largest theater stage, has modernized its backstage production infrastructure with a comprehensive Riedel solut...

02/09/2026

WiM to Host Reel Forward Production Conference at CSU Los...

Women in Media announces that it will host the two-day Reel/Forward in-person conference devoted to navigating today's production scene. Guests can enjoy pa...

02/09/2026

Teradek and New Media AV Expand Partnership with Full Liv...

The expanded partnership brings Teradek's Live Production solutions to New Media AV's European dealer and integrator network, opening new opportunities ...

02/09/2026

QuickLink Expands StudioEdge With WhatsApp Cisco Webex an...

QuickLink, a leading provider of award-winning video production and remote guest contribution solutions, announces a major expansion to its award winning Studio...

02/09/2026

Vipe by BCNEXXT Gives Foxtel a New Playout Model for its...

BCNEXXT, the developers of the advanced playout platform Vipe, today announced that premium entertainment brand Foxtel has selected Vipe to underpin playout for...

02/09/2026

HOT Telecommunications supercharges localisation efficien...

SubtitleNEXT helps HOT Telecom's subtitling team keep a cool head with reliable QC capabilities Profuz Digital, global developer of digital media and local...

02/09/2026

Case Study - Mission Digital Strengthens Battery Safety w...

Case Study: Mission Digital Strengthens Battery Safety with Safe-ion As productions become increasingly dependent on battery-powered equipment, the safe storag...

02/09/2026

New design strategy expands nanoparticle vaccine approach to influenza viruses

LA JOLLA, CA-Influenza viruses constantly shapeshift to evade recognition by the immune system. This shapeshifting occurs in critical proteins like hemagglutini...

02/09/2026

New AI algorithm could improve detection and prediction of heart diseases

LA JOLLA, CA-Clinicians often use a medical test called a 12-lead electrocardiogram (ECG) to diagnose heart problems, which uses electrodes placed on the chest ...

02/09/2026

Where milliseconds matter: Scripps Research scientists build new ML model to predict protein movements essential for biological function

LA JOLLA, CA-Proteins may look like rigid molecular structures, but inside our c...

02/09/2026

Lidl steps into the ring for Katie Taylor fight on RT

RT has today announced a major media partnership with Lidl around Katie Taylor's historic Croke Park clash with Flora Pili on Saturday, September 5th. The...

01/09/2026

IBC 2026: Bridge Technologies Adds Blackmagic IP10 Support to VB440 Production Probe

Bridge Technologies will announce at IBC2026 (Booth 1.A71) that its VB440 produc...

01/09/2026

DAZN to Acquire EverPass Media to Expand U.S. Commercial Venue Distribution

DAZN has announced an agreement to acquire EverPass Media, a commercial sports distribution platform serving bars, restaurants, hotels, and other venues in the ...

01/09/2026

Kalshi Named Official Prediction Market Partner of the US Open

The USTA and Kalshi have announced a multi-year partnership making Kalshi the Official Prediction Market Partner of the US Open, beginning with the 2026 US Open...

01/09/2026

IBC 2026: MASV to Showcase Sports Video Transfer Workflows

MASV will exhibit at IBC2026 (Booth 5.B40, RAI Amsterdam, September 11-14). CTO Majed Alhajry will appear on a panel session, A Tale of Two Feeds: Automation o...

01/09/2026

IBC 2026: FingerWorks Telestrators Partners with Broadcast Rental for European Distribution

FingerWorks Telestrators has announced a partnership with Broadcast Rental to ex...

01/09/2026

IBC 2026: FOR-A Expands viztrick AiDi into Two Dedicated Products

FOR-A has announced the expansion of viztrick AiDi into two dedicated products: Go Vertical! AiDi and AiDi Sports Hub. Developed by Nippon TV and delivered glob...

01/09/2026

Sony Launches Live TV on PS5 with Free Ad-Supported Streaming in the U.S.

Sony Pictures Television has launched Live TV on PS5, a free ad-supported streaming experience available to PS5 players in the United States. The service is acc...

01/09/2026

Friedrichstadt-Palast Installs Riedel Production Infrastructure

Friedrichstadt-Palast in Berlin has installed a Riedel production infrastructure spanning video, intercom, control, and I/O across the venue, implemented in col...

01/09/2026

IBC 2026: Arkona Partners with BFE for Arkona-Branded Control Panels

Arkona technologies GmbH has announced an OEM partnership with BFE Studio und Medien Systeme GmbH to offer arkona-branded control panels for its SDI-IP routing ...