Nokia predicted it would exceed its financial guidance for 2021 after generating more income than anticipated in the fourth quarter.
The Finland-based equipment manufacturer stated its underlying business performed largely as expected during the quarter. However, other operating income was higher than had been foreseen, including further benefits from venture fund investments which Nokia explained resulted in its operating margin exceeding guidance.
Nokia now estimates net sales of about €22.2 billion, which falls within its previous guidance of €21.7 billion to €22.7 billion, and a comparable operating margin of 12.4 per cent to 12.6 per cent, compared with the 10 per cent to 12 per cent previously forecast.
The vendor also cited further benefits including a one-off software contract in the second quarter, bad debt provision reversals and some other one-time benefits.
Nokia introduced a comparable operating margin guidance of 11 per cent to 13.5 per cent for 2022.
The company said the new guidance “considers estimated continued improvements in the underlying business, supply constraints and cost inflation, with the year-on-year progression also impacted by the significant one-offs seen in 2021”.
Nokia is due to release its fourth quarter and full year 2021 financial results on 3 February, when it will also revisit its longer-term outlook.
CEO Pekka Lundmark recently pointed to the success of a massive organisational shake-up after it recorded earnings growth in Q3 2021.