Recession-defying Stock Surge
In the face of economic uncertainties and mass layoffs in the tech sector, Nokia, the Finnish telecommunications powerhouse, stands out as a beacon of resilience. Despite looming fears of a recession and struggling giants like Microsoft and Alphabet, Nokia has managed to defy expectations and boost its operating profit for Q4 2022 by a staggering 30% to an impressive $1.3 billion. Analysts had predicted a mere billion.
Chip Shortages: Yesterday's Problem
Nokia's CEO, Pekka Lundmark, forecasts yet another year of growth in 2023. This optimism can be attributed to Nokia's strategic positioning in the rapidly expanding 5G network in India. In a recent interview, Lundmark hinted that chip shortages are no longer a significant hurdle, though delivery times remain extended.
One particular development that's received attention is Nokia's partnering with South Korean heavyweight, Samsung. The details of this partnership are yet to be disclosed, but it's speculated to allow Samsung to incorporate Nokia's cutting-edge technologies into its devices, in exchange for licensing fees. The projected Ebit margin for 2023 is expected to fall between 11.5% and 14%, a slight dip from last year's 12.5%. Post this positive news, Nokia's shares surged by over 7% at the Helsinki Stock Exchange on Thursday.
A Twist in the Tale: Elon Musk's Tesla Revelation
While we're on the topic of partnerships, let's pause for a minute to talk about Elon Musk's dramatic Twitter trial. Musk announced a pivotal letter from Cathie Wood that played a significant role in transforming Tesla's future. But that's another story for another time.
[1] T-Mobile US partnership (source: Reuters)[2] Global 5G buildout (source: Statista)[3] Amazon patent agreement (source: Reuters)[4] Samsung VoLTE partnership (source: Samsung Newsroom)[5] GSMA partnership (source: GSMA)
- Nokia's CEO, Pekka Lundmark, expects continued growth for the company in 2023, driven partly by their strategic positioning in the expanding 5G network in India, similar to the partnership they've established with Samsung.
- Despite lingering chip shortages, Nokia, in contrast to other struggling tech giants such as Microsoft and Alphabet, has managed to extend delivery times rather than being significantly hindered by them.
- In the financial year of 2023, Nokia's projected Ebit margin is expected to fall between 11.5% and 14%, representing a slight dip from last year's 12.5%, after a positive quarter that saw a 30% increase in operating profit.
- The shares of Nokia surged by over 7% at the Helsinki Stock Exchange on Thursday, following the announcement of the company's impressive Q4 2022 profit spike and potential big partnership with Samsung.
