Nokia Corporation (NYSE:NOK) shares are trading lower premarket on Thursday after the company reported fourth-quarter FY25 results.
Details
The company reported net sales growth of 2% year-on-year (Y/Y) to 6.1 billion euros ($7.13 billion), beating the analyst consensus estimate of $6.95 billion.
Comparable net sales rose 3% Y/Y when adjusted for currency changes and portfolio effects, led by growth in Network Infrastructure and Mobile Networks segments.
Comparable EPS came in at 16 euro cents (19 cents per share in dollars), compared with the analyst consensus estimate of 17 cents per share in dollars.
Comparable gross margin expanded 90 basis points Y/Y to 48.1%, aided by a strong product mix.
Meanwhile, comparable operating margin contracted 90 basis points Y/Y to 17.3%, aided by growth investments in Network Infrastructure.
Segment Performance
Network Infrastructure sales increased by 7% Y/Y, led by 17% Y/Y growth in the Optical Networks business.
In mobile-related businesses, Mobile Networks’ net sales rose 6% Y/Y, while Cloud and Network Services declined 4% in the quarter.
Nokia Technologies maintained a contracted net sales run-rate of 1.4 billion euros.
Other Key Metrics
At the end of the quarter, free cash flow stood at 0.2 billion euros, with a net cash balance of 3.4 billion euros.
The board approved a dividend of 3 euro cents per share, payable on February 12, to shareholders of record on Feb. 3.
Outlook
For FY26, Nokia sees a comparable operating profit of 2.0 billion-2.5 billion euros.
Also, the company projects Network Infrastructure net sales to grow at par with its long-term CAGR target of 6%-8%.
Also, Nokia sees combined IP and Optical Networks growth to be consistent with the long-term target to grow 10%-12% in FY26.
Given the above-normal seasonality in the fourth quarter, Nokia now expects first-quarter FY26 net sales to decline slightly more than usual, with operating margin remaining just above last year's level.
NOK Price Action: Nokia shares were down 10.24% at $6.12 at the time of publication on Thursday, according to Benzinga Pro data.
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