Nokia returned to operating profit in 2017 as new technologies helped to relieve some pressure from its declining network business. Operating profit was €16 million last year, up from a loss of €1.1 billion in 2016.
The Technologies business, which includes areas such as digital health and patent licensing, was the top performer with revenues up 57 per cent to €1.65 billion and operating profit up 94 per cent to €1.12 billion. This helped to offset continued decline at the Networks business, where revenues fell six per cent to €20.52 billion and operating profit fell 12 per cent to €1.71 billion.
Sales fell across all three main areas in which it is active – ultra-broadband networks, global services and IP networks and applications.
Nokia recorded overall revenues that were down two per cent to €23.15 billion for the full year and the company’s net loss widened from €912 million to €1.44 billion on increased income and financial tax expenses.
Looking forward, Nokia CEO Rajeev Suri said this year would see the company’s margins come under pressure. But he forecast 2019 and 2020 would show improving market conditions due to full scale 5G roll-outs.
“As those rollouts occur, Nokia is remarkably well-positioned. Unlike previous generations of technology, 5G requires a coordinated, holistic approach across all network elements. That requirement plays to the strength of our end-to-end portfolio and our 5G Future X architecture.”