Nokia’s intellectual property licensing division, Nokia Technologies, is anticipated to generate a minimum operating profit of $1.51 billion.
Finnish telecom equipment manufacturer, Nokia, announced on Monday that it has entered into a multi-year 5G patent licence agreement with the Chinese smartphone manufacturer Vivo. This deal will lead to Nokia recognising net sales from the agreement starting in the first quarter of 2024.
Nokia’s intellectual property licensing division, Nokia Technologies, is anticipated to generate a minimum operating profit of $1.51 billion (1.4 billion euros) in 2024, reflecting the strategic importance and financial impact of these licensing agreements on Nokia’s business.
The agreement aligns with the projections Nokia shared in its Q4 Financial Report on January 25, 2024. Starting in Q1 2024, Nokia will recognize net sales from this licensing deal, including retrospective payments for periods of non-payment.
The agreement successfully resolves all ongoing patent litigation between Nokia and Vivo across all jurisdictions. While the specifics of the agreement are kept confidential as per mutual agreement, this marks a significant step for Nokia in solidifying its licensing agreements.
Nokia’s patent portfolio encompasses about 20,000 patent families including over 6,000 patent families deemed essential for 5G technology. By contributing its innovations to open standards, Nokia ensures it can licence these technologies on fair, reasonable, and non-discriminatory (FRAND) terms.
This deal represents Nokia’s sixth major smartphone licensing agreement in the past thirteen months, following successful agreements with major industry players such as Apple, Samsung, OPPO, Honor, and Huawei. With this latest agreement with Vivo, Nokia has nearly completed its cycle of smartphone licence renewals.