Nokia Targets Double-Digit Operating Margins in 2023

By Dominic Chopping

Nokia Corp. said that it expects to deliver double-digit comparable operating margins in 2023 as it set out a three-phased strategy ahead of its capital markets day Thursday.

The telecom-equipment maker said it expects currency adjusted sales in 2023 to grow faster than the market, with a comparable operating margin of 10%-13%.

In 2021, Nokia still sees adjusted sales of between 20.6 billion euros and 21.8 billion euros ($24.6 million-$26 million) and a comparable operating margin of 7%-10%.

The company highlighted three phases that it hopes will deliver above market growth going forward. The first phase includes its continuing reset, focusing on technology leadership, implementing its new operating model and resetting its cost base.

From 2022 onward, Nokia said it will accelerate competitiveness and aims to grow margins through enhanced technology leadership, digitalization and capturing emerging opportunities.

It then plans to scale up to drive growth in new use cases in order to grow faster than the market.

Between 2020 and 2023, Nokia said it expects its total estimated addressable market to grow at a compounded annual growth rate of approximately 1%.

"5G is still in its early phase," said Chief Executive Pekka Lundmark.

"We estimate that the peak of the 5G market will last roughly twice as long as it did with 4G."

Nokia also updated its dividend policy, targeting recurring, stable and over time growing ordinary dividend payments, taking into account the previous year's earnings as well as the company's financial position and business outlook.

Write to Dominic Chopping at [e-mail]

(END) Dow Jones Newswires

March 18, 2021 03:04 ET (07:04 GMT)

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