Nokia Oyj (NYSE: NOK) encountered a significant uptick in its share value in the latest trading session, registering a remarkable 11.44% upswing, concluding at $3.80. The favorable momentum in Nokia’s shares can be traced back to the recent divulgence of its financial results.
In the most recent financial performance unveiled yesterday, Nokia (NOK) presented the performance indicators for Q4 and the entire fiscal year of 2023. The company grappled with a 21% year-over-year dip in sales in constant currency during Q4, mirroring the lingering uncertainties in the macroeconomic landscape impacting operator expenditure. The annual net sales also witnessed an 8% year-over-year contraction in constant currency.
For Q4, the comparable diluted earnings per share (EPS) settled at EUR 0.10, with the annual figure reaching EUR 0.29. It’s noteworthy that the disclosed EPS was influenced by an adjustment in the operational model, leading to the non-cash reassessment of deferred tax assets.
The year 2023 observed a substantial transformation in consumer behavior in the sector, prompted by macroeconomic factors and increased interest rates, along with adjustments in customer inventories.
Despite the challenges, Nokia managed to navigate through the environment, strategically protecting its profitability. The company proactively invested in research and development, showcasing resilient performance, especially considering the diminished contribution from Nokia’s high-margin patent licensing business due to some pending renewals.
In a strategic move, Nokia secured significant long-term agreements with both Apple and Samsung in 2023, followed by a late-year deal with Honor. The company has recently inked a multi-year deal with OPPO and is on the verge of finalizing another agreement in China.
With these developments, Nokia is now in the concluding stages of its smartphone license renewal cycle, with only one other major agreement recently expired. This positions Nokia Technologies business for long-term stability, emphasizing its commitment to expanding licensing activities in emerging growth sectors such as automotive, consumer electronics, IoT, and multimedia.
