Nokia Corporation
Interim Report
23 October 2025 at 08:00 EEST
Nokia Corporation Interim Report for Q3 2025
Strong net sales growth, well on track to achieve full year outlook
- Q3 comparable net sales grew 9% y-o-y on a constant currency and portfolio basis (12% reported) with all business groups contributing and particularly strong growth in Optical Networks growing 19%.
- Comparable gross margin in Q3 declined 150bps y-o-y to 44.2% (reported declined 150bps to 43.7%) as expected due to product mix in Network Infrastructure and Mobile Networks offsetting strength in Cloud and Network Services.
- Q3 comparable operating margin decreased 220bps y-o-y to 9.0% (reported up 140bps to 5.0%). The margin would have been stable y-o-y apart from a one-time benefit in the prior year from a provision reversal.
- Q3 comparable diluted EPS for the period of EUR 0.06; reported diluted EPS for the period of EUR 0.01.
- Q3 free cash flow of EUR 0.4 billion, net cash balance of EUR 3.0 billion.
- Operationally, Nokia’s outlook is unchanged for full year 2025. However, a change in venture fund reporting leads to a EUR 0.1 billion revision to the operating profit.(1) As a result Nokia’s comparable operating profit guidance is revised to between EUR 1.7 and 2.2 billion (was between EUR 1.6 and 2.1 billion).
(1) In Q3 2025, Nokia changed how it presents gains and losses from venture fund investments. The comparative financial information has been recast accordingly. Refer to the Financial statements and the Recast financial information sections in Nokia Corporation Interim Report for Q3 2025 for more information, including full comparative financial information for each quarter Q1-Q3’24 and Q1-Q2’25.
This is a summary of the Nokia Corporation Interim Report for Q3 2025 published today. Nokia only publishes a summary of its financial reports in stock exchange releases. The summary focuses on Nokia Group’s financial information as well as on Nokia’s outlook. The detailed, segment-level discussion will be available in the complete financial report hosted at http://www.nokia.com/financials. Investors should not solely rely on summaries of Nokia’s financial reports and should also review the complete reports with tables.
JUSTIN HOTARD, PRESIDENT AND CEO, ON Q3 2025 RESULTS
In the following quote, net sales comments and growth rates are referring to comparable net sales and are on a constant currency and portfolio basis. References to margins are related to Nokia’s comparable reporting.
We delivered a solid performance in Q3 with net sales growing 9% and all business groups growing.
Network Infrastructure delivered 11% net sales growth. Optical Networks grew 19%, coming largely from AI & Cloud customers. Order intake trends in Optical Networks and IP Networks remained strong with book-to-bill well above 1. Our new 800G ZR/ZR+ pluggables for data center interconnect became generally available and have started shipping to a large US customer. We are opening a second Indium Phosphide semiconductor fabrication facility in San Jose before the end of next year to support the growth opportunity we see in our optical components business. In the quarter we also announced an important strategic partnership with Nscale which will see us become a preferred networking equipment vendor for their data center buildout. In Q3, AI and Cloud customers accounted for 6% of our net sales at the group level and 14% for Network Infrastructure.
Cloud and Network Services delivered 13% net sales growth as operator investments in 5G Core remain strong. Our cloud-native 5G Core offering continues to gain traction, and we are gaining market share. In the first half of 2025 we took the #1 market share position in Voice Core (Dell ‘Oro excl. China). Mobile Networks delivered 4% growth and we continue to see the market stabilize. Commercially, we announced an agreement with VodafoneThree, re-entering as a major radio supplier in their network. Nokia Technologies signed several new deals in the quarter, while our annual net sales run-rate is approximately EUR 1.4 billion.
At a group level, gross margin declined 150 basis points compared to the prior year. This was due to the expected weaker software contribution in Mobile Networks, balancing the higher-than-normal contribution in Q2, and product mix effects in Network Infrastructure. Operating margin was stable year-on-year, excluding a one-time benefit seen in the prior year related to a provision reversal.
Following a strategic review, we have decided to scale down our passive venture fund investments. Therefore, we are also changing how we present these investments in our financials, they will now be within financial income and expenses instead of affecting operating profit. We may still make targeted minority investments, directly as Nokia, that can accelerate our strategy.
Looking forward, we are on track to achieve our full year outlook. The change in presentation of venture fund investments leads to a technical increase of EUR 0.1 billion to our comparable operating profit outlook which is now EUR 1.7 to 2.2 billion. We are tracking towards the midpoint of the range.
At our Capital Markets Day in New York on November 19th, we will share our strategy to unlock the full potential of our portfolio and the steps we are taking to focus the company to deliver growth and operating leverage. The AI supercycle is accelerating demand for providers of advanced and trusted connectivity. Nokia is uniquely positioned to be a leader in this market.
Justin Hotard
President and CEO
FINANCIAL RESULTS
| EUR million (except for EPS in EUR) | Q3’25 | Q3’24 | YoY change | Q1-Q3’25 | Q1-Q3’24 | YoY change |
| Reported results | ||||||
| Net sales | 4 828 | 4 326 | 12% | 13 764 | 13 236 | 4% |
| Gross margin % | 43.7% | 45.2% | (150)bps | 42.9% | 46.1% | (320)bps |
| Research and development expenses | (1 174) | (1 116) | 5% | (3 479) | (3 376) | 3% |
| Selling, general and administrative expenses(1) | (729) | (688) | 6% | (2 193) | (2 088) | 5% |
| Operating profit(1) | 239 | 278 | (14)% | 345 | 1 109 | (69)% |
| Operating margin %(1) | 5.0% | 6.4% | (140)bps | 2.5% | 8.4% | (590)bps |
| Profit from continuing operations | 80 | 145 | (45)% | 103 | 965 | (89)% |
| Profit/(loss) from discontinued operations | — | 31 | 13 | (494) | ||
| Profit for the period | 80 | 175 | (54)% | 116 | 471 | (75)% |
| EPS for the period, diluted | 0.01 | 0.03 | (67)% | 0.02 | 0.08 | (75)% |
| Net cash and interest-bearing financial investments | 3 001 | 5 460 | (45)% | 3 001 | 5 460 | (45)% |
| Comparable results | ||||||
| Net sales | 4 833 | 4 326 | 12% | 13 774 | 13 236 | 4% |
| Constant currency and portfolio YoY change(2) | 9% | 2% | ||||
| Gross margin % | 44.2% | 45.7% | (150)bps | 43.7% | 47.0% | (330)bps |
| Research and development expenses | (1 122) | (1 029) | 9% | (3 363) | (3 169) | 6% |
| Selling, general and administrative expenses(1) | (610) | (587) | 4% | (1 800) | (1 773) | 2% |
| Operating profit(1) | 435 | 485 | (10)% | 966 | 1 498 | (36)% |
| Operating margin %(1) | 9.0% | 11.2% | (220)bps | 7.0% | 11.3% | (430)bps |
| Profit for the period | 324 | 358 | (9)% | 713 | 1 198 | (40)% |
| EPS for the period, diluted | 0.06 | 0.06 | 0% | 0.13 | 0.21 | (38)% |
| Business group results | Network Infrastructure | Mobile Networks | Cloud and Network Services | Nokia Technologies | Group Common and Other | |||||
| EUR million | Q3’25 | Q3’24 | Q3’25 | Q3’24 | Q3’25 | Q3’24 | Q3’25 | Q3’24 | Q3’25 | Q3’24 |
| Net sales | 1 953 | 1 525 | 1 842 | 1 854 | 645 | 595 | 391 | 352 | 4 | 3 |
| YoY change | 28% | (1)% | 8% | 11% | 33% | |||||
| Constant currency and portfolio YoY change(2) | 11% | 4% | 13% | 14% | 33% | |||||
| Gross margin % | 40.2% | 42.1% | 34.8% | 38.5% | 49.0% | 45.2% | 100.0% | 100.0% | ||
| Operating profit/(loss)(1) | 139 | 180 | 12 | 101 | 77 | 56 | 296 | 242 | (89) | (94) |
| Operating margin % | 7.1% | 11.8% | 0.7% | 5.4% | 11.9% | 9.4% | 75.7% | 68.8% | ||
(1) In Q3 2025, Nokia changed how it presents gains and losses from venture fund investments. The comparative financial information has been recast accordingly. Refer to the Financial statements and the Recast financial information sections in Nokia Corporation Interim Report for Q3 2025 for more information, including full comparative financial information for each quarter Q1-Q3’24 and Q1-Q2’25.
(2) This metric provides additional information on the growth of the business and adjusts for both currency impacts and portfolio changes. The full definition is provided in the Alternative performance measures section in Nokia Corporation Interim Report for Q3 2025.
SHAREHOLDER DISTRIBUTION
Dividend
Under the authorization by the Annual General Meeting held on 29 April 2025, the Board of Directors may resolve on the distribution of an aggregate maximum of EUR 0.14 per share to be paid in respect of financial year 2024. The authorization will be used to distribute dividend and/or assets from the reserve for invested unrestricted equity in four installments during the authorization period unless the Board decides otherwise for a justified reason.
On 23 October 2025, the Board resolved to distribute a dividend of EUR 0.03 per share. The dividend record date is 28 October 2025 and the dividend will be paid on 6 November 2025. The actual dividend payment date outside Finland will be determined by the practices of the intermediary banks transferring the dividend payments.
Following this announced distribution, the Board’s remaining distribution authorization is a maximum of EUR 0.03 per share.
OUTLOOK
| Full Year 2025 | |
| Comparable operating profit(1,2) | EUR 1.7 billion to EUR 2.2 billion (technical revision from EUR 1.6 billion to 2.1 billion) |
| Free cash flow(1) | 50% to 80% conversion from comparable operating profit |
1Please refer to Alternative performance measures section in Nokia Corporation Interim Report for Q3 2025 for a full explanation of how these terms are defined.
2Outlook is based on a EUR:USD rate of 1.17 for the remainder of the year.
Operationally, Nokia’s outlook is unchanged for full year 2025. However, a change in venture fund reporting (refer to section Additional Topics below for further details) revises the operating profit outlook by EUR 0.1 billion. As a result Nokia’s comparable operating profit guidance is now between EUR 1.7 and 2.2 billion (was between EUR 1.6 and 2.1 billion).
The outlook and all of the underlying outlook assumptions described below are forward-looking statements subject to a number of risks and uncertainties as described or referred to in the Risk Factors section later in this release.
Along with Nokia’s official outlook targets provided above, Nokia provides the below additional assumptions that support the group level financial outlook.
| Full year 2025 | Comment | ||
| Net sales assumptions | Normal seasonality in net sales excluding Nokia Technologies, would imply an increase of 22% sequentially in Q4. Considering recent strong order trends, Nokia currently assumes Q4 will be slightly above normal seasonality in terms of sequential growth. For the full year, Nokia continues to assume strong growth in Network Infrastructure, growth in Cloud and Network Services and largely stable net sales in Mobile Networks on a constant currency and portfolio basis. In Nokia Technologies we expect approximately EUR 1.1 billion in operating profit. | ||
| Group Common and Other operating expenses | Approximately EUR 350 million (update) | ||
| Comparable financial income and expenses | Positive EUR 0 to 100 million (update) | Updated to now include impact of venture fund investments | |
| Comparable income tax rate | ~25% | ||
| Cash outflows related to income taxes | EUR 500 million | ||
| Capital expenditures | EUR 650 million | ||
| Recurring gross cost savings | EUR 450 million (update) | Related to ongoing cost savings program and not including Infinera-related synergies | |
| Restructuring and associated charges related to cost savings programs | EUR 250 million | Related to ongoing cost savings program and not including Infinera-related synergies | |
| Restructuring and associated cash outflows | EUR 350 million (update) | Related to ongoing cost savings program and not including Infinera-related synergies |
ADDITIONAL TOPICS
Venture fund investment activities reporting
In Q3 2025, Nokia completed a strategic review of its venture fund investment activities. As a result, Nokia no longer views passive venture fund investments as having a significant role in the company’s strategy and has initiated a process to scale down these investments. Consequently, the presentation of the results of venture fund investments as operating activities is no longer considered relevant, and therefore beginning from Q3 2025, Nokia is presenting the gains and losses from venture fund investments, including the changes in fair value and the fund management fees, as financial income and expenses. For the segment reporting purposes, the results of venture fund investments had previously been included in the operating results of Group Common and Other. The comparative financial information for each quarter Q1-Q3 2024 and Q1-Q2 2025 has been recast accordingly.
RISK FACTORS
Nokia and its businesses are exposed to a number of risks and uncertainties which include but are not limited to:
- Competitive intensity, which is expected to continue at a high level as some competitors seek to take share;
- Changes in customer network investments related to their ability to monetize the network;
- Our ability to ensure competitiveness of our product roadmaps and costs through additional R&D investments;
- Our ability to procure certain standard components and the costs thereof, such as semiconductors;
- Disturbance in the global supply chain;
- Impact of inflation, increased global macro-uncertainty, major currency fluctuations, changes in tariffs and higher interest rates;
- Potential economic impact and disruption of global pandemics;
- War or other geopolitical conflicts, disruptions and potential costs thereof;
- Other macroeconomic, industry and competitive developments;
- Timing and value of new, renewed and existing patent licensing agreements with licensees;
- Results in brand and technology licensing; costs to protect and enforce our intellectual property rights; on-going litigation with respect to licensing and regulatory landscape for patent licensing;
- The outcomes of on-going and potential disputes and litigation;
- Our ability to execute, complete, successfully integrate and realize the expected benefits from transactions;
- Timing of completions and acceptances of certain projects;
- Our product and regional mix;
- Uncertainty in forecasting income tax expenses and cash outflows, over the long-term, as they are also subject to possible changes due to business mix, the timing of patent licensing cash flow and changes in tax legislation, including potential tax reforms in various countries and OECD initiatives;
- Our ability to utilize our Finnish deferred tax assets and their recognition on our balance sheet;
- Our ability to meet our sustainability and other ESG targets, including our targets relating to greenhouse gas emissions;
as well the risk factors specified under Forward-looking statements of this release, and our 2024 annual report on Form 20-F published on 13 March 2025 under Operating and financial review and prospects-Risk factors.
FORWARD-LOOKING STATEMENTS
Certain statements herein that are not historical facts are forward-looking statements. These forward-looking statements reflect Nokia’s current expectations and views of future developments and include statements regarding: A) expectations, plans, benefits or outlook related to our strategies, projects, programs, product launches, growth management, licenses, sustainability and other ESG targets, operational key performance indicators and decisions on market exits; B) expectations, plans or benefits related to future performance of our businesses (including the expected impact, timing and duration of potential global pandemics, geopolitical conflicts and the general or regional macroeconomic conditions on our businesses, our supply chain, the timing of market changes or turning points in demand and our customers’ businesses) and any future dividends and other distributions of profit; C) expectations and targets regarding financial performance and results of operations, including market share, prices, net sales, income, margins, cash flows, cost savings, the timing of receivables, operating expenses, provisions, impairments, tariffs, taxes, currency exchange rates, hedging, investment funds, inflation, product cost reductions, competitiveness, value creation, revenue generation in any specific region, and licensing income and payments; D) ability to execute, expectations, plans or benefits related to transactions, investments and changes in organizational structure and operating model; E) impact on revenue with respect to litigation/renewal discussions; and F) any statements preceded by or including “anticipate”, “continue”, “believe”, “envisage”, “expect”, “aim”, “will”, “target”, “may”, “would”, “could“, “see”, “plan”, “ensure” or similar expressions. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control, which could cause our actual results to differ materially from such statements. These statements are based on management’s best assumptions and beliefs in light of the information currently available to them. These forward-looking statements are only predictions based upon our current expectations and views of future events and developments and are subject to risks and uncertainties that are difficult to predict because they relate to events and depend on circumstances that will occur in the future. Factors, including risks and uncertainties that could cause these differences, include those risks and uncertainties identified in the Risk Factors above.
ANALYST WEBCAST
- Nokia’s webcast will begin on 23 October 2025 at 11.30 a.m. Finnish time (EEST). The webcast will last approximately 60 minutes.
- The webcast will be a presentation followed by a Q&A session. Presentation slides will be available for download at http://www.nokia.com/financials.
- A link to the webcast will be available at http://www.nokia.com/financials.
- Media representatives can listen in via the link, or alternatively call +1-412-317-5619.
FINANCIAL CALENDAR
- Nokia plans to publish its fourth quarter and full year 2025 results on 29 January 2026.
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, which is celebrating 100 years of innovation.
With truly open architectures that seamlessly integrate into any ecosystem, our high-performance networks create new opportunities for monetization and scale. 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:
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Maria Vaismaa, Global Head of External Communications
Nokia
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