The maker of Telecom equipment, Nokia, reported strong quarterly results than expected on Thursday, aided by the demand for 5G gear despite purchasing problems and high segment prices. The Finnish company has been gaining strength against rivals such as Sweden’s Ericsson and China’s Huawei after it made its products competitive by investing heavily in research and finding ways to reduce costs elsewhere.
However, the global chip shortage and the new closure of COVID-19 in China also put additional pressure on Nokia supply chains. Shortages increased prices for parts used in Nokia products.”It is very clear that prices are going up,” said the company’s chief executive PekkaLundmark, adding, “There are inflation in some areas, there is inflation in semiconductors, there is inflation in everything.”
“We are in talks with our customers now to see how much of this can be transferred to customer numbers,” he said. Companies often enter and obtain long-term contractual contracts but during the renewal of contracts the company is required to calculate current prices.
“A typical contract can be for three years, which does not mean that as in Mobile Networks (unit), one-third of our contracts will be renewed annually,” said Lundmark.
Since taking up the lead job in 2020, Lundmark has focused on cost reduction and making changes to recover from the wrong product steps under previous management that met the company’s 5G aspirations.
Although Nokia sees significant demand in the US, Europe and parts of Asia, countries such as India – which is expected to be a major driver of 5G demand – have not yet launched a complete deployment. 583 ($ 613 million) from 551 million euros last year, surpassing 513 million euros according to a forecast by 11 analysts voted by Refinitiv.
The network infrastructure has grown by 9 percent in terms of quarterly revenue, driven by strong demand on both uninterrupted and offshore networks. between 22.9 billion euros and 24.1 billion euros in terms of revenue. Earlier this month, Nokia announced a withdrawal from Russia that would result in the provision of 100 million euros, but maintained its annual vision.
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