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Nokia CEO welcomes EU Huawei ban
04. 02. 2026 Wednesday / By: Robert Denes / Business / Exact time: BST / Print this page
A world map drawn for Nokia’s Capital Markets Day in November showed each country in a different shade of green, pink or grey. Green represented the Finnish supplier’s most productive territory, which was locked out by Chinese rivals Huawei and ZTE. After recent political developments, Nokia is optimistic that Europe’s pink splash will soon turn green.
The big event, of course, was the European Union’s exclusion of Chinese operators from 5G. Until now, its “5G toolbox” was merely a recommendation instructing member states not to use so-called “high-risk operators.” Clearly frustrated that most countries have not heeded its advice, the European Commission (EC) is now proposing to make its toolbox mandatory, punishing governments and companies that fail to comply.
The move was quickly welcomed by Nokia’s top executive. “I think this is a very good and important step for Europe because building reliable networks is critical for sovereignty,” Chief Executive Justin Hotard told reporters.
Given Hotard’s previous outspokenness, today’s EC action was not a huge surprise. But it came on the heels of full-year results that shed light on why current geopolitics and Huawei’s continued presence are so problematic for parts of Nokia’s business. Nokia’s share price fell about 5% in Helsinki after the charges were released and has fallen about 18% since October.
Group revenue rose 4% on a comparable basis to 19.9 billion euros ($23.8 billion), but Nokia estimated organic growth at just 2%. Net profit fell 27% to less than 1.6 billion euros ($1.9 billion), hurt by a decline in highly profitable but volatile licensing revenue generated by Nokia Technologies Group. Margins also dried up in mobile networks, Nokia’s largest business group by sales before being overtaken by network infrastructure last year.
Before Hotard took over in April 2025, Nokia also suffered significant market share losses in the United States, perhaps its most profitable country. Mobile networks revenue fell 4% last year to 7.8 billion euros ($9.3 billion). Although Nokia said it remained flat on a constant currency basis, sales were nearly 4 billion euros ($4.8 billion) lower than in 2019 in what Nokia called its “mobile access” unit at the time.
While details of the current headcount were not disclosed in today’s report, the company’s workforce fell from 84,795 in 2023 to about 75,600 by the end of 2024, before it acquired Infinera, an optical networking specialist, in February last year. Hotard said on its capital markets day in November that it would cut another 5,000 jobs as part of its earlier restructuring plan.
Under its own new plan, each business group will no longer have its own separate finance, HR, legal and marketing functions. Instead, they will be consolidated into a single unit that will serve all groups. Even more dramatically, Hotard is merging three of those groups — mobile networks, cloud and network services, and Nokia Technologies. From the first quarter of 2026, Nokia will be left with just two major groups: its existing network infrastructure business and a new “mobile infrastructure” division.
In this somewhat bleak mobile environment, Hotard would naturally be happy to exclude a Chinese manufacturer that has long been accused of undercutting its northern competitors on price. According to Börje Ekholm, Hotard’s partner at Ericsson, Chinese manufacturers still have a market share of between 33 and 40% in Europe. “This is a significant revenue opportunity for reliable suppliers,” Ericsson said during its earnings call last week. According to Hotard, Huawei’s European business in the sectors where Nokia competes has annual revenue of between €2 billion ($2.4 billion) and €2.5 billion ($3 billion).
According to its latest report, Nokia’s sales in Greater China (which includes Taiwan) fell from nearly €2.2 billion ($2.6 billion) in 2018 to €913 million ($1.1 billion) last year.
That's why some commentators see the latest move, Nokia's acquisition of full ownership of China's Shanghai Bell, as a tool to help it exit completely, although Hotard put it differently. "We're going to get 200 million euros [$239 million] of runtime synergies from the integration of the joint venture, and that's going to cost us around 350-400 million euros [$418-478 million] over 24-36 months," he said. "I would look at it more as getting full control of something that's actually connected to our core platforms and being able to 25 to gain synergies.
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