Back to top

Analyst Blog

Nokia Corp. (NOK - Analyst Report) reported first-quarter 2014 financial results wherein the bottom line surpassed the Zacks Consensus Estimate, while the top line missed the same. Stiff competition from Apple Inc.’s (AAPL - Analyst Report) iPhones and Google Inc’s Android-based smartphones have compelled Nokia to sell its Device business to Microsoft Corp. (MSFT - Analyst Report) for $7.5 billion on Apr 25, 2014. Nokia currently has a Zacks Rank #1 (strong Buy).

Quarterly net income from continuing operations came in at approximately $152.3 million or 4 cents per share compared with a net loss of $359 million or 9 cents per share in the prior-year quarter. However, quarterly adjusted (excluding special items) earnings per share of 6 cents were better than the Zacks Consensus Estimate of 4 cents.

On the other hand, quarterly net revenue stood at approximately $3,688 million, a stiff year-over-year fall of 15% and also lagged the Zacks Consensus Estimate of $3,987 million.  

Quarterly adjusted gross margin was 45.7% in first-quarter 2014 compared with 39.3% in the prior-year quarter. Adjusted operating margin, in the reported quarter, was 9.1% as against a negative 1% in the year-ago quarter.

At the end of the first quarter of 2014, Nokia had approximately $2,908 million of net cash and marketable securities compared with $3,185 million at the end of 2013. 

Nokia Solutions and Networks Segment

Quarterly total revenue was approximately $3,223 million in first-quarter 2014, down 17% year over year. Quarterly adjusted operating profit was approximately $299 million, up 10% year over year. However, adjusted operating margin was 9.3% compared with 7% in the prior-year quarter.

HERE Segment

Quarterly total revenue was approximately $290 million in first-quarter 2014, down 3% year over year. Quarterly adjusted operating profit stood at $138 million against a negative $7 million in the prior-year quarter. Adjusted operating margin was 4.8% against a negative 2.3% in the year-ago quarter.

Advanced Technology Segment

Quarterly total revenue was approximately $181 million in first-quarter 2014, up 7% year over year. Quarterly adjusted operating profit was approximately $119 million, up 18% year over year. Adjusted operating margin was 65.6% compared with 59.3% in the prior-year quarter.

Outlook

For fiscal 2014, adjusted operating margin for the Nokia Solutions and Networks segment is likely to be in the higher-end of the 5%–10% range.

Capital Restructuring Program

Nokia has initiated a Euro 5.0 billion (approximately $6.9 billion) capital restructuring program. The company intends to initiate a Euro 1.25 billion share buy-back program and will pay a special dividend of Euro 0.26 per share totaling Euro 1 billion. The remaining Euro 2.75 billion will be utilized to reduce debt level.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
SYNAPTICS I… SYNA 78.11 +8.14%
CENTURY ALU… CENX 19.88 +5.74%
GREEN PLAIN… GPRE 39.41 +5.12%
PILGRIM'S P… PPC 28.82 +3.08%
THE PANTRY… PTRY 18.41 +2.79%