Finnish telecom network equipment maker Nokia has warned of challenges to come this year as it tries to catch up with rivals after a strong finish to 2020.
While both Nokia and rival Ericsson have been gaining 5G customers that might otherwise have gone to China's Huawei, Ericsson has fared better.
It has also won big 5G contracts in China, where the deployment of the next-generation network is in full swing.
"We have not yet made a breakthrough in 5G (in China) but of course we are not excluding that possibility going forward," Nokia's new chief executive Pekka Lundmark told Reuters.
"But we want to be prudent so that we do not want to be there at any cost," the CEO added.
Nokia reported better than expected fourth-quarter revenue and underlying profit today but the company also forecast that its 2021 revenue will fall to between €20.6-21.8 billion from €21.9 billion in 2020.
"We expect 2021 to be challenging, a year of transition, with meaningful headwinds due to market share loss and price erosion in North America," Lundmark said.
Nokia said it had lost a part of the Verizon 5G contract in the US to Samsung Electronics.
Lundmark announced a new strategy in October, under which the company will have four business groups and said Nokia would "do whatever it takes" to take the lead in 5G, as it banks on also capturing share from Huawei.
"We believe that we have year-to-date captured about half of the geopolitically influenced opportunities that are there," Lundmark said. "Most of these cases have been in Europe."
Nokia said growth in its 5G equipment sales in the quarter was partially offset by decreases in its legacy radio access products. Revenue at its mainstay networks business fell 7% to €5.04 billion.
Revenue overall fell 5% to €6.57 billion during the quarter, but beat a consensus figure of €6.42 billion, Refinitiv Eikon data showed.
Quarterly underlying earnings fell to €0.14 a share from €0.15 a year ago, beating the €0.11 consensus.
There was also a boost of about €250m in one-time items and net sales of €150m in the quarter that it had expected in 2021.
Nokia shares have seen wild swings over the last two weeks as the stock has been targeted by the retail trading frenzy, alongside GameStop and other tech companies.