The telecom network equipment industry is weathering the toughest part of a decade-long cycle, as demand for 4G and older 2G and 3G network equipment subsides, while volume contracts for next-generation 5G networks remain a few years out.
Nokia's network sales fell 9 percent in the third quarter to 4.8 billion euros ($5.7 billion) while operating profit in the business dropped 23 percent to 334 million. Average analyst forecasts in a Reuters poll were 5.0 billion and 432 million respectively.
Chief Executive Rajeev Suri said operators' consolidation and technology transitions were slowing demand, while competition in China had toughened.
"The early positioning for 5G is well underway in that country and the cost of gaining or even maintaining footprint is significant ... We want to ensure the right long-term footprint, but not at any cost," Suri told a conference call.
"Operator consolidation and M&A activity are also creating some near-term headwinds," Suri said.