Nokia’s quarterly profit beats on 5G demand

Telecom equipment maker Nokia reported a stronger-than-expected quarterly operating profit on Thursday, helped by higher demand for 5G gear despite supply chain constraints.

The Finnish company has been gaining ground against rivals such as Sweden’s Ericsson and China’s Huawei after it made its products more competitive by investing heavily in research and found ways to cut costs from other areas, Reuters reports.

“Demand in our end-markets remains high, and although supply chain constraints continue to impact our growth, we delivered 1% constant currency net sales growth in Q1,” Chief Executive Officer Pekka Lundmark said in a statement.

Network infrastructure grew 9% in constant currency, driven by strong demand in both fixed and submarine networks.

The company’s first-quarter comparable operating profit rose to 583 million euros ($613 million) from 551 million euros last year, beating the 513 million euros mean forecast of 11 analysts polled by Refinitiv.

The company also affirmed its full-year net sales outlook of between 22.9 billion euros and 24.1 billion euros on a constant currency basis.

Earlier in the month, Nokia announced a pullout from Russia that would lead to a provision of 100 million euros, but retained its full-year outlook.