Citi: Nokia's Apple licensing deal spurs confidence in long-term outlook

Analysts from Citi believe that Nokia's recent reestablishment of a patent licensing agreement with Apple could have a positive impact on the market's perception of the Finnish telecommunications company.

According to a message sent to customers, the Citi analysts mentioned that the recent announcement of the agreement should position Apple as the primary source of income for Nokia's stream of revenue related to intellectual property rights.

According to the analysts, this agreement also provides assistance to Nokia's projected long-term revenue from patent licensing, which ranges from €1.4 billion to €1.5 billion annually. In the first quarter, the division fell short of expectations, as stated by CEO Pekka Lundmark, who attributed it to an ongoing legal dispute with Oppo and Vivo, Chinese smartphone manufacturers.

The exact details of the agreement between Nokia and Apple were not made public, but Nokia stated that it encompasses "innovations in 5G and various other technologies." This new deal will replace the current license, which is set to conclude by the end of this year.

Nokia stated that it anticipates generating revenue from the newly acquired patent license beginning in January 2024.

According to the company's statement, they have devoted over €140 billion to research and development since the year 2000, resulting in a patent portfolio comprised of approximately 20,000 patent families. Out of these, over 5,500 patents have been declared essential for 5G.

Stocks of Nokia, which are listed on the Helsinki stock exchange, experienced a growth of over 2% on Monday.