Nokia delivered a strong improvement in Q2, with better-than-expected profitability, significant improvement in cash generation, clear indications of a return to strength in mobile radio, and a year-on-year increase in earnings-per-share, despite the challenges of COVID-19.

(Nokia Earnings, 2Q 2020)

Gareth Owen's key takeaway:

We believe Nokia has turned a corner and growth is returning driven predominantly by the Mobile Access business.
As the Reefshark FPGA-to-SoC chipset transition accelerates, Nokia’s RAN products are becoming more competitive and profitable.
Other positives included continued growth at the young Nokia Enterprise division, which recorded an 18% increase in revenues; Nokia announced that it now 180 private network customers.
During the new few months, Nokia looks likely to benefit from the Huawei restrictions with a likely increase in market share. The company confirmed that it has received new interest from numerous MNOs, particularly in Europe.
Interestingly, there are also signs that Nokia’s diversification strategy into software, IP routing and optical networking is finally beginning to pay off.
Although revenues fell at all these businesses, Nokia was awarded data center contracts by several blue-chip tech companies during the quarter, including Apple, Baidu and Tencent – surely a vote of confidence in its optical networking technologies and a good omen for the future?

Signs of Growth as Nokia Reports Surprise 2Q Profit

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