In an interview, Chief Executive Pekka Lundmark stated: "There was an association with smartphones earlier; today we are a business technology company." He made the remarks ahead of the company's business update on the eve of the annual Mobile World Congress (MWC 2023), which will begin on 27 February in Barcelona and run until March 2.
In 2020, when he took over as CEO of the struggling Finnish company, Lundmark devised a three-stage plan: reset, speed up, and expand. Lundmark stated that the second stage was beginning now that the reset stage had been completed. Although Nokia intends to expand its service provider business, in which it sells telecom equipment, the company's primary focus is now gear sales to other businesses.
In order to sell private 5G networks and gears for automated factories to customers primarily in the manufacturing sector, significant technology companies have formed partnerships with telecom gear manufacturers like Nokia. Nokia intends to evaluate various options, including divestment, as well as growth paths of its various businesses.
"The signal is exceptionally clear. Lundmark stated, "We only want to be in businesses where we can see global leadership." As Nokia moves towards data centres and factory automation, it will also compete with big tech companies like Microsoft and Amazon.
The macro environment is reducing demand from high-margin markets like North America and replacing it with growth in low-margin India, which has forced rival Ericsson to lay off 8,500 employees. "This is a structural change," Lundmark stated, adding that Nokia anticipates North America to be stronger in the second half of the year. "India is our fastest-growing market with lower margins."
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