Current Date:

Sunday, 16 April 2017

Nokia Hit by Weak Wireless Market, Says Awaiting Merger Benefits

HELSINKI:(Reuters) - Finnish telecoms equipment group Nokia reported a sharp drop in third-quarter earnings,

suffering from weaker sales in the wireless network market and warning that the market was likely to shrink further in the coming year.
Its share price fell 7 percent on the news to its lowest level in three years, despite analysts saying that Nokia is now better placed than Ericsson to ride out the downturn in the mobile network market following its acquisition in January of broader-based rival Alcatel-Lucent.
Ericsson earlier this month reported a more than 90 percent plunge in third-quarter profits and replaced its CEO.
The wireless network market is in decline after demand for 4G mobile broadband equipment peaked last year and a new cycle of network upgrades to the still evolving 5G standard is not expected to begin until around 2020.
So far Nokia is seeing scant benefit from the purchase of Alcatel-Lucent, bought in a 15.6 billion-euro ($17 billion) all-share deal, though the company said its integration was proceeding to plan.