Nokia Posts Quarterly Profit Miss, Flags Disruption from Trump's Tariffs

A view shows Nokia headquarters in Espoo, Finland, October 19, 2023. JUSSI NUKARI/Lehtikuva/via REUTERS/File photo
A view shows Nokia headquarters in Espoo, Finland, October 19, 2023. JUSSI NUKARI/Lehtikuva/via REUTERS/File photo
TT
20

Nokia Posts Quarterly Profit Miss, Flags Disruption from Trump's Tariffs

A view shows Nokia headquarters in Espoo, Finland, October 19, 2023. JUSSI NUKARI/Lehtikuva/via REUTERS/File photo
A view shows Nokia headquarters in Espoo, Finland, October 19, 2023. JUSSI NUKARI/Lehtikuva/via REUTERS/File photo

Nokia reported first-quarter profit well below market expectations on Thursday and flagged a short-term disruption from US tariffs with an estimated impact of between 20 million and 30 million euros to its second-quarter profit.

Comparable operating profit fell to 156 million euros ($176.9 million) in the first quarter of 2025, a 36% miss against the average forecast of 243.83 million euros by analysts surveyed by LSEG.

A one-time charge in its mobile networks division had an impact of 120 million euros on quarterly margins, the company said.

Nokia's sales in North America have been growing steadily despite losing market share to Nordic rival Ericsson, reflecting a renewed market strength after years of weakness, Reuters reported.

But now the sweeping tariffs imposed by US President Donald Trump could counter this trend, as companies might pause orders fearing price increases.

The Finland-based company also announced a strategic multi-year extension of its partnership with T-Mobile in the US to expand the carrier's 5G network coverage.

"Telecommunications is not a place where customers tend to change their expenditures," Nokia's CEO Justin Hotard told reporters.

Its quarterly net sales totalled 4.39 billion euros, down 3% on a constant-currency basis compared to a year earlier and a notch lower than the 4.41 billion euros expected by analysts.

Nokia confirmed its outlook for the rest of the year, which now includes the acquisition of Infinera, but said achieving the top-end of the range for operating profit would be more challenging than initially expected.



Microsoft Halts China-based Tech Support for Pentagon Systems

FILE - The Microsoft company logo is displayed at their offices in Sydney, Australia, on Feb. 3, 2021. (AP Photo/Rick Rycroft, File)
FILE - The Microsoft company logo is displayed at their offices in Sydney, Australia, on Feb. 3, 2021. (AP Photo/Rick Rycroft, File)
TT
20

Microsoft Halts China-based Tech Support for Pentagon Systems

FILE - The Microsoft company logo is displayed at their offices in Sydney, Australia, on Feb. 3, 2021. (AP Photo/Rick Rycroft, File)
FILE - The Microsoft company logo is displayed at their offices in Sydney, Australia, on Feb. 3, 2021. (AP Photo/Rick Rycroft, File)

Microsoft said Friday it is making sure that personnel based in China are not providing technical support for US Defense Department systems, after investigative news site ProPublica revealed the practice earlier this week.

Pentagon chief Pete Hegseth confirmed that work on Defense Department cloud services had been outsourced to people in China, insisting that the country will not have "any involvement whatsoever" with the department's systems going forward.

"Microsoft has made changes to our support for US Government customers to assure that no China-based engineering teams are providing technical assistance for DoD Government cloud and related services," the company's chief communications officer, Frank Shaw, said in a post on X.

ProPublica reported Tuesday that the tech giant was using engineers based in China -- Washington's primary military rival -- to maintain Pentagon computer systems, with only limited supervision by US personnel who often lacked the necessary expertise to do the job effectively.

US Senator Tom Cotton asked Hegseth to look into the matter in a letter dated Thursday, and the Pentagon chief responded that he would do so.

Hegseth then posted a video on X Friday evening in which he said "it turns out that some tech companies have been using cheap Chinese labor to assist with DoD cloud services. This is obviously unacceptable, especially in today's digital threat environment."

"At my direction, the department will... initiate -- as fast as we can -- a two-week review, or faster, to make sure that what we uncovered isn't happening anywhere else across the DoD," AFP quoted him as saying.

"We will continue to monitor and counter all threats to our military infrastructure and online networks," he added, thanking "all those Americans out there in the media and elsewhere who raised this issue to our attention so we could address it."