Nokia pivots as 5G demand stalls and carriers slash spending

Nokia is facing fresh challenges as demand for its core network equipment slows. The company has reported a drop in revenue from 5G radio access networks, with major carriers cutting back on investments. Yet, despite these setbacks, Nokia is pushing into new areas like undersea cables and private 5G solutions for businesses. The slowdown in 5G expansion has hit Nokia hard. Carriers such as Verizon and AT&T have scaled back spending after reaching their coverage goals. This pullback has left suppliers with excess capacity, squeezing profits in key markets like North America.

High fixed costs and fierce pricing competition are further pressuring Nokia's margins. The company still provides base stations and core equipment to major US carriers, but overall network revenue has fallen.

To counter these challenges, Nokia is diversifying. It has secured contracts for high-capacity undersea cables, connecting the US to other regions. Meanwhile, its enterprise division is growing fast, with double-digit gains in private 5G networks for sectors like manufacturing and logistics.

Nokia is also investing in cloud-native solutions through its Network as Code initiative. Partnerships with Google Cloud and Microsoft Azure aim to make its technology more flexible for businesses. However, details on specific customers in automotive or energy remain limited. Nokia's shift toward undersea cables and private 5G networks reflects its effort to adapt. While traditional network sales decline, enterprise solutions and new partnerships offer a path forward. The company's next steps will depend on how well these strategies offset the slowdown in 5G rollouts.