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Nokia Unveils Software to Help Operators Expand 5G Footprint

Zacks Equity Research
·4-min read

Nokia Corporation NOK yesterday unveiled its cloud-native Digital Operations Center software, marking its first network slice management product. The new solution is aimed at boosting communication service providers’ revenue-generating capabilities with a platform that optimally manages 5G slice-based services. It is expected to be available by the end of 2020.

The company’s Digital Operations Center provides an automated process to deploy and operate network slices across multi-vendor, multi-domain and multi-technology environments. It is built in a modular form that includes the Nokia Orchestration Center and Nokia Assurance Center. Nokia’s solution enables operators to deliver network slices through closed-loop automation. Also, it helps operators adhere to Service Level Agreements as they expand into vertical industries.

With the help of this, carriers can manage the full-service lifecycle to drive the most optimized use of infrastructure resources while automating service delivery. Moreover, the Digital Operations Center is built on Nokia’s Common Software Foundation that enables customers to use their choice of deployment strategies. Nokia is helping Singtel, a major telco operating in Singapore, trial its Network as a Service platform.

The Finland-based telecom gear maker’s end-to-end portfolio includes products and services for every part of a network, which helps operators enable key 5G capabilities such as network slicing, distributed cloud and industrial IoT. It facilitates customers to move from an economy-of-scale network operating model to demand-driven operations by offering easy programmability and automation.

Meanwhile, Nokia is developing its 5G portfolio, strengthening AirScale and advancing the capabilities of its ReefShark chipset. The company is working with multiple partners to support its ReefShark family of chipsets, which are used in many base station elements. Nokia is witnessing a healthy momentum in its focus areas of software and enterprise, which augurs well for its licensing business.

At the same time, the company seeks to expand its business into targeted, high-growth and high-margin vertical markets to address opportunities beyond its primary markets. It had earlier announced plans to accelerate strategy execution, sharpen customer focus and reduce long-term costs. This, in turn, is likely to position the company as a global leader in the delivery of end-to-end 5G solutions.

On Jun 24, Nokia stated that Pekka Lundmark will take charge as president and CEO on Aug 1, a month earlier than previously communicated. Rajeev Suri will leave his current position on Jul 31 and continue to serve as an advisor to the Nokia board until Jan 1, 2021.

Nokia has a long-term earnings growth expectation of 13.3% compared with 14.6% of the industry. The stock has returned 22.6% against the industry’s decline of 3.9% in the past six months.



Nokia currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader industry are Turtle Beach Corporation HEAR, Ooma, Inc. OOMA and Acacia Communications, Inc. ACIA, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Turtle Beach has a trailing four-quarter positive earnings surprise of 46.4%, on average.

Ooma has a trailing four-quarter positive earnings surprise of 228.2%, on average.

Acacia has a trailing four-quarter positive earnings surprise of 17.7%, on average. The company’s earnings beat the Zacks Consensus Estimate in three of the last four quarters.

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