Nokia Expects Its Turnaround to Continue in 2022

Nokia's Turnaround Expected to Progress in 2022

HELSINKI (Reuters) -Finnish telecoms equipment maker Nokia on Tuesday gave its first guidance for 2022, easing investors’ concerns over the impact the global chip shortage may have had on its operations.

Nokia said it expected a comparable operating margin of 11-13.5% in 2022, sending its shares up 2.8% in the morning trade following the announcement.

“The outlook shows that the business turnaround is still progressing well and no offset is coming from cost inflation or component shortage,” Inderes analyst Atte Riikola told Reuters.

The company said it also expected to exceed its 2021 earnings guidance, with its venture fund investments driving the boost.

Nokia estimated a full-year 2021 comparable operating margin of 12.4-12.6%, above its previous guidance of 10-12%, and net sales of 21.7-22.7 billion euros, within its previously announced range.

The company said its underlying business performed largely as expected in the fourth quarter.

“However, other operating income was higher than expected including further benefits from venture fund investments, leading to a stronger comparable operating margin exceeding the 2021 guidance,” it said in a statement.

Nokia now expects Q4 revenue of 6.4 billion euros, below expectations of 6.5 billion euros, according to Reuters calculations.

The company is due to report full-year results on Feb. 3.

(Reporting by Anne Kauranen, Supantha Mukherjee and Essi Lehto; editing by Jason Neely, Kirsten Donovan and David Evans)