Strong demand for 5G equipment saw Nokia increase sales by 2% during the third quarter of 2021, however the company has warned that the industry-wide chip shortage could have an impact moving forward.
The Finnish firm said rising revenues in its network infrastructure (up 6%) and cloud and network services (up 12%) divisions offset challenges elsewhere. It added that healthy margins demonstrated the strength of its strategy and its execution.
Net sales reached €5.4 billion (£4.56bn) and operating profit rose by 30% to €633 million (£534m).
CEO Pekka Lundmark lauded his firm’s achievements, noting it now has 380 private wireless customers and launched new chips that deliver three times the network capacity that reduce power consumption by three quarters, and reiterated full year guidance of €21.7-22.7 billion net sales.
However he added that although the company had so far weathered the stress of supply chain constraints but expected their to be more of an impact in Q4 and next year.
“We delivered another great quarter driven by our increased investments in technology leadership and strong market demand,” said CEO Pekka Lundmark. “We are further increasing our investment to ensure we maintain the lead we have built with the industry’s most complete offering.
“As we look ahead, we believe we are well positioned to capitalize on strong demand in our end markets through strengthened technology leadership and improved cost competitiveness. However, the uncertainty around the global semiconductor market limits our visibility into Q4 and 2022. We are working closely not only with our suppliers to ensure component availability but also with our customers to ensure we can meet their needs and mitigate the unprecedented component cost inflation our industry faces.”
“Coupled with the one-offs we’ve benefited from this year, this may limit our margin expansion potential in 2022.”
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