Nokia (NOKIA) Q2 2025 earnings summary

Executive summary

• Q2 2025 performance was mixed, with growth in Network Infrastructure and Cloud and Network Services offset by a decline in Mobile Networks due to prior year contract benefits and project delays in India.

• Profitability was negatively impacted by currency fluctuations, tariffs, and a non-cash negative impact from venture funds.

• Infinera acquisition completed and integration is progressing, with strong commercial momentum and synergy targets on track.

• Organizational changes and leadership transitions are underway to unify corporate functions and improve productivity.

• Demand environment remains supportive, with expected strong growth in Network Infrastructure and Cloud and Network Services, and stable Mobile Networks.

Financial highlights

• Q2 2025 net sales were €4.55 billion, a 1% decline on a constant currency and portfolio basis, but up 2% reported due to the Infinera acquisition.

• Gross margin was stable at 44.7% year-over-year.

• Operating margin declined to 6.6%, mainly due to negative currency impacts and tariffs.

• Free cash flow was €88 million for the quarter, with €2.9 billion net cash at quarter end.

• Q2 comparable diluted EPS was EUR 0.04; reported diluted EPS EUR 0.02.

Outlook and guidance

• Full-year 2025 comparable operating profit guidance was lowered to €1.6–2.1 billion from €1.9–2.4 billion, mainly due to currency headwinds (€230 million) and tariffs (€50–80 million).

• Free cash flow conversion guidance remains at 50–80% of comparable operating profit.

• Q3 2025 expected to show normal seasonality with flat net sales sequentially and stable operating margin.

• Outlook based on EUR:USD rate of 1.17 for the remainder of the year.

• Dividend of EUR 0.04 per share declared, with a remaining distribution authorization of EUR 0.06 per share.