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The
profit, that excludes certain charges and asset revaluations to
make it comparable with last year's results, fell to 423 million
euros ($462.38 million), from 619 million euros in the same
quarter a year earlier.
Nokia and its rival Ericsson have been hit by customers buying
less telecom equipment, and have announced thousands of lay-offs
in response.
Net sales fell 18% year-on-year, as the pace of investment in 5G
technology in India, a key market, slowed after rapid growth a
year before.
Jefferies analysts said that both sales and earnings missed
forecasts when one-offs were excluded. Nokia's shares were down
8% by 0718 GMT.
CEO Pekka Lundmark said sales were taking more time to recover
than earlier anticipated, but forecast that net sales would
significantly accelerate in the second half of the year, echoing
similar forecasts made last week by Ericsson.
The CEO pointed to an improving fiber market in the U.S and a
$42 billion U.S government program to boost citizens' access to
high-speed broadband.
"That's creating some interesting additional dynamics right now
for us because we are clearly the first mover there with a
product portfolio that is compatible with the 'Buy America'
requirements," Lundmark told Reuters. He said that the real
boost would be felt next year.
In Europe, Nokia and Ericsson could see a boost from Chinese
vendors losing market share after Germany decided to exclude
Chinese companies like Huawei or ZTE from the nation's 5G
network products from 2029.
Lundmark said Nokia was still studying the impact of that
decision.
The group kept its full-year guidance for comparable operating
profit. Inderes analysts said that outlook would remain under
pressure until the end of the year.
($1 = 0.9148 euros)
(Reporting by Olivier Sorgho and Supantha Mukherjee; Editing by
Clarence Fernandez, Kim Coghill and Tomasz Janowski)
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