Nokia reports surprise first-quarter loss

The networks industry — dominated by Nokia, Ericsson and Huawei — has been battered by years of slowing demand since 4G network sales peaked in the middle of the decade. (Reuters)
Updated 25 April 2019
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Nokia reports surprise first-quarter loss

  • Nokia repeated its January forecasts for ‘flattish’ market in 2019
  • The networks industry has been battered by years of slowing demand since 4G network sales peaked in the middle of the decade

HELSINKI: Finnish telecom network equipment maker Nokia reported a surprise quarterly loss on Thursday, citing hard competition in its core networks business.
“The slow start to 2019 and expected weak overall first half puts significant pressure on execution in the second half,” the company said in a statement.
Having signaled back in January “a particularly weak Q1,” Nokia reported a fall to an operating loss (non-IFRS) of €59 million ($66 million) from a profit of €239 million in the first quarter a year ago.
That compared with analysts’ profit expectations ranging from €175 million to €457 million in a Reuters poll.
Nokia repeated its January forecasts for “flattish” market in 2019, and for its 2019 earnings per share of €0.25-€0.29, and 2020 EPS of €0.37-€0.42.
The networks industry — dominated by Nokia, Sweden’s Ericsson and China’s Huawei — has been battered by years of slowing demand since 4G network sales peaked in the middle of the decade.
It is now readying for a new cycle of network upgrades as operators have started to invest in 5G equipment.
Last week rival Ericsson posted January-March quarter profit that swept past forecasts due to strong growth in North America and cost cuts, spurring the Swedish firm to lift its outlook for the global telecom networks market.
Some analysts say Nokia and Ericsson might benefit from challenges faced by Huawei after Washington alleged its equipment could be used by Beijing for spying, but Nokia warned the competition could be harsh.
“Competitive intensity could increase in some accounts as some competitors seek to take share in the early phases of 5G,” Nokia said.


Oil rises after US Navy destroys Iranian drone

Updated 19 July 2019
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Oil rises after US Navy destroys Iranian drone

  • The International Energy Agency is revising its 2019 global oil demand growth forecast to 1.1 million barrels per day
  • Speculators have exited options positions that could have provided exposure to higher prices in the next several years

TOKYO: Oil prices rose more than 1 percent on Friday after the US Navy destroyed an Iranian drone in the Strait of Hormuz, a major chokepoint for global crude flows, again raising tensions in the Middle East.
Brent crude futures were up 82 cents, or 1.3 percent, at $62.75 by 0100 GMT. They closed down 2.7 percent on Thursday, falling for a fourth day.
West Texas Intermediate crude futures firmed 61 cents, or 1.1 percent, at 55.91. They fell 2.6 percent in the previous session.
The United States said on Thursday that a US Navy ship had “destroyed” an Iranian drone in the Strait of Hormuz after the aircraft threatened the vessel, but Iran said it had no information about losing a drone.
The move comes after Britain pledged to defend its shipping interests in the region, while US Central Command chief General Kenneth McKenzie said the United States would work “aggressively” to enable free passage after recent attacks on oil tankers in the Gulf.
Still, the longer-term outlook for oil has grown increasingly bearish.
The International Energy Agency (IEA) is reducing its 2019 oil demand forecast due to a slowing global economy amid a US-China trade spat, its executive director said on Thursday.
The IEA is revising its 2019 global oil demand growth forecast to 1.1 million barrels per day (bpd) and may cut it again if the global economy and especially China shows further weakness, Fatih Birol said.
“China is experiencing its slowest economic growth in the last three decades, so are some of the advanced economies ... if the global economy performs even poorer than we assume, then we may even look at our numbers once again in the next months to come,” Birol told Reuters in an interview.
Last year, the IEA predicted that 2019 oil demand would grow by 1.5 million bpd but had already cut the growth forecast to 1.2 million bpd in June this year.
Speculators have exited options positions that could have provided exposure to higher prices in the next several years, market participants said on Thursday.
US offshore oil and gas production has continued to return to service since Hurricane Barry passed through the Gulf of Mexico last week, triggering platform evacuations and output cuts.
Royal Dutch Shell, a top Gulf producer, said Wednesday it had resumed about 80 percent of its average daily production in the region.