Nokia Corporation
Stock Exchange Release
5 December 2023 at 4:30 EET

Nokia comments on AT&T vendor plans

Espoo, Finland – Nokia has a wide-ranging relationship with AT&T, supplying products and services across wireless, wireline and other network technologies, alongside similar relationships with other major North American network operators.

Nokia is aware of AT&T’s plans to commit to an Open RAN deployment in collaboration with other vendors over the next five years. As a result, Nokia now expects revenue from AT&T in Mobile Networks will decrease over the next 2-3 years. AT&T accounted for 5-8% of Mobile Networks net sales year-to-date in 2023. The already announced action Nokia is taking to reduce its cost base is expected to partially mitigate the impact of AT&T’s decision. Nokia expects Mobile Networks to remain profitable over the coming years but this decision would delay the timeline of achieving double digit operating margin by up to 2 years.

Nokia has invested heavily in the last few years to deliver market leading radio technology and a highly competitive product portfolio. This has helped it gain the most 5G market share since Q1 2022 among the top RAN suppliers, reaching 29% in Q3, excluding China (source: Dell’Oro). Nokia remains one of the few global vendors of mobile network equipment with significant scale and R&D investment capability to deliver market leading products to customers and while the company is taking action to lower its cost-base, it will protect its R&D output.

The company is also a recognized leader in Open RAN. It is fully committed to O-RAN and together with its ecosystem of partners is providing increased choice and industry leading performance in O-RAN. Most recently, Japan’s NTT DOCOMO has selected Nokia’s O-RAN 5G network for their commercial deployment.

Nokia remains a key partner for AT&T within both its Network Infrastructure and Cloud and Network Services businesses. AT&T will also continue to buy products such as microwave radio links and femto solutions from Mobile Networks. AT&T confirmed to Nokia that while its decision was driven by reasons specific to AT&T, it believes Nokia has highly competitive products and services in Radio Access Networks (RAN) and an accomplished R&D capability.

Pekka Lundmark, President and CEO of Nokia, said, “Whilst the news from AT&T is disappointing, our Mobile Networks business has made significant progress in recent years, increasing our RAN market share and technology leadership. I firmly believe we have the right strategy to create value for our shareholders into the future with opportunities to gain share, diversify our business and improve our profitability. Mobile Networks are critical to our global connected future and as I have said before the cloud computing and AI revolutions will not materialize without significant investments in networks that have vastly improved capabilities. Our customers can rest assured that we continue to invest in R&D and develop market-leading products for them.”

Nokia will provide more detail on its strategy both at the group level and a deep dive into Mobile Networks and Cloud and Network Services at its Investor Progress Update event on Tuesday 12th December in Espoo, Finland with the event also being webcast.

About Nokia
At Nokia, we create technology that helps the world act together.

As a B2B technology innovation leader, we are pioneering networks that sense, think and act by leveraging our work across mobile, fixed and cloud networks. In addition, we create value with intellectual property and long-term research, led by the award-winning Nokia Bell Labs.

Service providers, enterprises and partners worldwide trust Nokia to deliver secure, reliable and sustainable networks today – and work with us to create the digital services and applications of the future.

Inquiries:

Nokia Communications
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Kaisa Antikainen, Communications Manager

Nokia
Investor Relations
Phone: +358 40 803 4080
Email: investor.relations@nokia.com

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