Nokia's 2025 Profit Forecast Unchanged Despite 20-30M Euro Tariff Hit

Nokia Corporation has announced that achieving its upper limit of annual expectations has become more challenging due to the impact of tariffs. The company, headquartered in Espoo, Finland, indicated that the tariffs imposed by the administration of former U.S. President Donald Trump are expected to affect its operating profit by 20 million euros to 30 million euros in the second quarter. The company has not yet factored in the potential impact of tariffs on the second half of the year due to the high level of uncertainty.

Despite the challenges posed by tariffs, Nokia's newly appointed CEO, Justin Hotard, who joined the company this month, has maintained the company's forecast for comparable operating profit for the fiscal year 2025, which is expected to be between 1.9 billion euros and 2.4 billion euros. Hotard, who previously led the data and artificial intelligence strategy at Intel Corporation, has been tasked with turning around the company's fortunes. In recent years, both Nokia and its Nordic rival Ericsson have faced difficulties due to the sluggish performance of the global 5G equipment market. Additionally, Hotard must navigate the increasing trade barriers resulting from the Trump administration's efforts to impose tariffs on U.S. trading partners.

Ericsson, another major player in the telecommunications industry, recently announced that it expects tariffs to have a negative impact of approximately one percentage point on its network business. Nokia, on the other hand, has been diversifying its operations into the defense and artificial intelligence sectors, leading to an 8.7% increase in its stock price year-to-date. In February, Nokia completed the acquisition of U.S.-based data center technology manufacturer Infinera, whose revenue and earnings were included in Nokia's financial results for the first time.