Nokia reported 2 percent drop in revenue to €4.913 billion or $5.33 billion during the first quarter of 2020, despite winning several 5G network deals.
Nokia has signed 70 5G network deals and it has 21 live networks across the globe. Ericsson
Nokia today said revenue was COVID-19 issue impacted its revenue by approximately €200 million, largely due to the result of supply issues associated with disruptions in China.
“We did not see a decline in demand in the first quarter. As the COVID-19 situation develops, however, an increase in supply and delivery challenges in a number of countries is possible and some customers may reassess their spending plans,” Nokia CEO Rajeev Suri said in a statement.
Nokia has generated first quarter revenue of €3.757 billion (–5 percent) from networks, €613 million (+13 percent) from Nokia Software and €347 million (–6 percent) from Nokia Technologies.
Nokia’s sales in all regions – Greater China, North America, Asia Pacific, Latin America, Middle East and Africa and North America – fell in the first quarter of 2020 as compared with fourth quarter of 2019.
Nokia has finished 2019 with share of ~27 percent in 4G+5G mobile radio market excluding China. Nokia aims to have 4G+5G market share of 27 percent in 2020.
Its rivals, Ericsson and Huawei, have posted growth in revenue in the first quarter of the year, helped by strong demand as telecom services help to keep businesses working remotely during the pandemic.
Nokia, which has been trying to reduce product costs and delays in shipment, said product cost reductions were proceeding well and there was an increase in shipment of its new 5G ReefShark equipment.
Nokia said it experienced a reduced footprint with a customer in Asia-Pacific. It added a new customer in North America. Nokia recently announced a $1 billion deal with Bharti Airtel, the third largest telecom operator in India, to roll out 4G network in 9 telecom circles.
COVID-19 update
Since telecom infrastructure is an essential service, most networks see 30-45 percent traffic volume growth over a year. Nokia saw 20 to 40 percent peak increase from mid-February to mid-March in lockdown-impacted regions through its operator customer base.
Nokia said it has a global manufacturing footprint designed for optimized global supply, and to mitigate against risks. Nokia has 25 factories and six hubs for customer fulfillment. Nokia has established a global command center to manage the supply chain challenges arising from challenges.
