Nokia Q4 2024: How the Telco Scaled its Networking Profit

Leading telco Nokia has reported stronger than expected fourth-quarter adjusted operating profit and sales.
Towards the end of 2024, the company experienced a sharp increase in demand for its telecoms infrastructure from mobile operators worldwide. It has reported that its quarterly net sales rose 10% to €5.98 billion (US$6.2bn), which beat estimations from analysts.
The company has attributed part of this dramatic growth to its work in the networking sector, where it will continue to expand its presence in the market in Q4.
“Looking further ahead into 2025, we expect the improved trends we have seen in Network Infrastructure in the second half of this year, to sustain and drive strong growth,” shares Pekka Lundmark, President and CEO of Nokia.
“Cloud and Network Services is also expected to grow with strong 5G Core momentum and growth in our Enterprise Campus Edge business. End markets in Mobile Networks are improving and we currently assume largely stable net sales. Nokia Technologies is expected to deliver approximately €1.1 billion (US$1.14bn) of operating profit.”
Strong growth as network market trends improve
In its Corporation Financial Report for Q4 and the full year of 2024, Nokia managed to increase its net sales by 9% year-on-year in constant currency.
A significant aspect of this dramatic growth was that its network infrastructure net sales grew at a very strong pace with all units contributing, the company shared this morning. In particular, Nokia Technologies grew at a significant pace, with its cloud and network services in particular advancing in 2024.
- Net sales grew 9% in constant currency in Q4
- Delivered an excellent comparable operating margin of 19.1% in Q4
- Continued to win new deals across the business and took positive steps across growth areas of defense, data centres and private wireless
“I am optimistic that the improving market trends we are now seeing will persist into 2025,” Pekka adds. “Alongside the net sales growth, we saw excellent profitability in Q4 with a comparable operating margin of 19.1%.
“This meant our full year comparable operating profit was €2.6 billion (US$2.71bn), at the mid-point of our guidance of €2.3 to 2.9 billion (US$2.39-3.02bn).”
Nokia Technologies led the quarter for the company, as it signed a deal with Transsion, a previously unlicensed mobile devices vendor, alongside various multimedia deals with the likes of HP and Samsung.
Projecting further growth
As AI demand continues to boom, Nokia is well-poised to help its data centre partners and customers capitalise on its growth.
With the company acquiring Infinera in 2024 for US$2.3bn, it will continue to boost its exposure to the rapidly-growing AI data centre connectivity markets. The deal is expected to close in March 2025, as Nokia’s data centre revenues continue to spike.
Nokia remains eager to increase its scale in Optical Networks and accelerate its product roadmap, whilst also supporting communications service providers (CSPs) and hyperscalers to cope with sharp increases in traffic.
The company has attributed part of this dramatic growth to its work in the data centre industry, where the company continued to expand its presence in the market in Q4.
“We are now stepping up our investments to broaden our addressable market in data centre IP networking,” Pekka explains. “We will invest up to an additional €100 million (US$104.23m) in annual operating expenses with a view to driving incremental net sales of €1 billion by 2028.
“In the short-term this will moderate the pace of operating margin expansion in Network Infrastructure, but we anticipate a strong return on investment considering the momentum we already have today in the market.”
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