Nokia: ‘The competitive environment remains challenging in Latin America’

Finnish telecom solutions vendor Nokia continues to face challenges in strengthening its operations in Latin America. 

This is particularly evident in core and strategic segments such as Networks, where the firm has now experienced slowdowns in the region for several consecutive quarters.

In the fourth quarter of 2024, Latin America provided the worst result of all Nokia's business geographies, with a 10% year-on-year drop in revenues in constant currency terms to 287mn euros (US$300mn). This decline was primarily driven by Mobile Networks.

Meanwhile, Nokia saw double-digit growth in Europe and North America. India recorded the strongest performance of all, with a 20% increase compared with 4Q23. The only other regions to report declines in revenues were the Middle East & Africa (-4%) and the Rest of Asia Pacific (-2%).

“Most markets were relatively stable in the fourth quarter, although the competitive environment remains challenging in Latin America,” CFO Marco Baren said during an earnings call with investors.

For the full year, Latin America’s revenue fell below the 1bn-euro mark for the first time since the pandemic, reaching 895mn euros. This was an 11% year-on-year drop in constant currency and a 14% decline in reported figures.

Nokia’s disappointing performance in Latin America, despite positive results elsewhere, mirrors that of its rival Ericsson, which also recorded a weaker Q4 in the region compared with other geographies.

Overall, Nokia reported total Q4 sales of 5.98bn euros, up 9% in constant currency and 10% as reported, outperforming its Swedish competitor.

“We saw a strong finish to 2024 with 9% net sales growth year-on-year in Q4 . I am optimistic that the improving market trends we are now seeing will persist into 2025. Alongside the net sales growth, we saw excellent profitability in Q4 with a comparable operating margin of 19.1%,” CEO Pekka Lundmark said in an earnings statement.

Over 80% of the company's Q4 sales went to communication service providers, with Mobile Networks accounting for 41% of total revenue.

All business units except Mobile Networks reported growth in Q4, with Nokia Technologies, IP Networks, Fixed Networks and Optical Networks standing out.

On the M&A front, the company also stated that it expects its acquisition of Infinera to to close this quarter.