Nokia's Q4 and Full Year 2024 Results: A Strong Finish and Promising Outlook

Nokia Corporation has released its financial report for the fourth quarter and full year 2024, showcasing a strong finish to the year and a promising outlook for 2025. The company's strategic focus on network infrastructure and 5G technology has contributed significantly to its financial performance, with notable improvements in gross margin and operating margin.

Q4 and Full Year 2024 Results Highlights

* Q4 net sales increased 9% year-on-year in constant currency (10% reported), driven by strong growth in Network Infrastructure, Nokia Technologies, and Cloud and Network Services.
* Comparable gross margin in Q4 increased by 250bps year-on-year to 47.2% (reported increased 280bps to 46.1%), with a strong contribution from Nokia Technologies and smaller contributions from other businesses.
* Q4 comparable operating margin increased 380bps year-on-year to 19.1% (reported up 540bps to 15.3%), mainly due to higher gross margin, continued cost control, and a higher contribution from Nokia Technologies.
* Full year 2024 net sales declined 9% in both reported and constant currency, of which 7 percentage points were related to India. Comparable operating profit was EUR 2.6 billion (reported EUR 2.0 billion).
* Board proposes dividend authorization of EUR 0.14 per share.

Strategic Focus on Network Infrastructure and 5G Technology

Nokia's strategic focus on network infrastructure and 5G technology has been a key driver of its financial performance. The company's network infrastructure business grew strongly in Q4, with all units contributing to the growth. IP Networks grew 24%, Fixed Networks grew 16%, and Optical Networks grew 7% in constant currency. Nokia's 5G technology has also been a significant factor, with the company securing many important deals and winning 18,000 additional base station sites since the start of 2024 on a net basis.

Expansion into New Growth Areas

Nokia's expansion into new growth areas, such as data centers, private wireless networks, and the defense market, has the potential to generate long-term benefits. The company sees a significant opportunity to expand its presence in the data center market and is investing to broaden its product portfolio in IP Networks to better address this market. Nokia continues to invest in private wireless networks, where it is the clear market leader, and identifies a compelling new long-term opportunity in bringing 5G technology to the defense market.

Outlook for 2025

Nokia issues a full year 2025 outlook on an organic basis, expecting comparable operating profit of between EUR 1.9 billion and 2.4 billion and free cash flow conversion from comparable operating profit of between 50% and 80%. These expectations indicate that Nokia is confident in its strategic focus on network infrastructure and 5G technology, and that it expects continued growth in these areas.

In conclusion, Nokia's Q4 and full year 2024 results demonstrate a strong finish to the year and a promising outlook for 2025. The company's strategic focus on network infrastructure and 5G technology, along with its expansion into new growth areas, has contributed significantly to its financial performance. Investors should closely monitor Nokia's progress as it continues to execute on its strategic initiatives and capitalize on emerging opportunities in the market.