Nokia (NOKIA) investor relations material

Executive summary

• Q3 net sales were €5.154bn, up 9% YoY on a constant-currency basis and 10% reported; comparable operating profit rose 35% to €605m and margin expanded 220 bps to 11.7%.

• AI & Cloud net sales grew 123% YoY and order intake rose 118% to €1.5bn; growth in AI and network infrastructure is building operating leverage, while IP and Optical demand exceeds supply.

• FY 2026 comparable operating profit guidance remains €2.1bn–€2.6bn, with performance tracking above its midpoint; combined Optical and IP Networks growth is expected at 25%–30% in 2027.

Financial highlights

• Q3 reported net sales were €5.154bn, up 10% YoY; comparable net sales grew 9% on a constant-currency basis.

• Comparable gross margin was 44.6%, down 20 bps YoY; reported gross margin was 42.2%, down 220 bps, mainly due to higher restructuring costs.

• Comparable operating profit was €605m, up 35%; reported operating profit was €196m, down 22%.

• Reported profit from continuing operations was €176m versus €90m; comparable profit was €498m versus €334m. Diluted EPS was €0.03 reported and €0.09 comparable.

• Q3 free cash flow was -€99m; quarter-end net cash was €2.584bn, down €192m QoQ.

Outlook and guidance

• FY 2026 comparable operating profit guidance remains €2.1bn–€2.6bn, based on EUR/USD of 1.14 for the remainder of the year.

• Q4 net sales are expected to rise 20%–24% QoQ; comparable operating profit is expected to increase strongly QoQ, placing FY performance above the guidance midpoint.

• Combined Optical and IP Networks growth in 2026 is expected above the prior 18%–20% assumption; growth of 25%–30% is expected in 2027.

• FY 2026 free cash flow conversion guidance is 35%–55%; an additional €400m of working capital investment is planned to secure supply and support growth.

• FY assumptions include comparable financial income and expenses of €300m–€400m, a ~26% comparable tax rate, €500m tax cash outflows, €750m–€850m capex and €1.1bn restructuring charges.