Finnish telecommunications company Nokia reported a significant 29 percent decline in its operating profit for the second quarter (Q2) of 2025, according to its Q2 and half-year financial report released on Thursday, reported Xinhua.
Between April and June, Nokia's net sales rose by 2 percent year-on-year to 4.55 billion euros, up from 4.47 billion euros in Q2 2024. Despite the modest revenue increase, the company's comparable operating profit dropped sharply to 301 million euros, down from 423 million euros a year earlier.
For the first half (H1) of 2025, Nokia's comparable operating profit plunged 55 percent to 457 million euros, compared with 1.023 billion euros in the same period last year. The operating margin also narrowed to 5.1 percent, down from 11.5 percent.
The company attributed the steep decline in profitability mainly to significant currency fluctuations and ongoing tariff disputes.
"Turning to our second-quarter results, the significant currency fluctuations, particularly the weaker U.S. dollar, had a meaningful impact on both our net sales and operating profit," said Nokia President and CEO Justin Hotard in the report, adding that tariffs also contributed to the decline in the comparable operating margin.
Looking ahead, Hotard projected strong growth in Network Infrastructure, continued expansion in Cloud and Network Services, and stable net sales in Mobile Networks. He also forecast approximately 1.1 billion euros in operating profit from Nokia Technologies for the full year.
"However, we are facing two headwinds to our full-year operating profit outlook that are beyond our control — currency, due to the weaker U.S. dollar, and tariffs," Hotard said. He estimated that current tariff levels could impact operating profit by 50 million to 80 million euros for the year.
On Tuesday, Nokia lowered its full-year 2025 operating profit guidance. It now expects comparable operating profit to range between 1.6 and 2.1 billion euros, down from a previous forecast of 1.9 to 2.4 billion euros.
According to Finnish newspaper Helsingin Sanomat, pressure is mounting on Nokia, with its share price having fallen by 20 percent since April. Analysts cited a long-term contraction in the mobile networks market as a major concern.
- Nokia
- Profit
- Slumps
Source: www.dailyfinland.fi
