Ahead of its second-quarter earnings report, Nokia has lowered its guidance for its full-year sales, citing weakness in North America as one of the contributing factors.
Nokia is now expecting net sales for the year to be in the range of 23.2 billion-24.6 billion euros, down from previous expectations of 24.6 billion-26.2 billion euros. The cut in expected sales is due to business in its Network Infrastructure and Mobile Networks groups, the company said.
“The weaker demand outlook in the second half is due to both the macro-economic environment and customers’ inventory digestion. Customer spending plans are increasingly impacted by high inflation and rising interest rates along with some projects now slipping to 2024 – notably in North America,” Nokia said in a company statement. “There is also inventory normalization happening at customers after the supply chain challenges of the past two years.”
Ericsson also saw a drop in its network sales in North America, as customers worked through their existing inventory and the build-out pace “moderated.” Full story here.
Nokia said that when it reports its second-quarter earnings next week, its net sales will be flat year-over-year on a constant currency basis, at about 5.7 billion euros based on preliminary numbers. The company noted that its operating profit in the second quarter was boosted by about 80 million euros in “catch-up net sales in Nokia Technologies”.
The company addd that it has been “proactively managing costs to protect profitability” and that it will “continue to take measures to ensure it remains on track towards its long-term targets of growing faster than the market.”
Nokia is slated to report its second-quarter results on July 20.
