Nokia shares fall on worries around probable reduction of Verizon enterprise

(Reuters) – Shares in Nokia fell up to 8% in Wednesday trade on fears that the Finnish company was getting rid of the enterprise of its critical shopper Verizon in the United States.

Nokia, battling with China’s Huawei and Sweden’s Ericsson, is hoping to improve its 5G slate and seeking in particular to deployment by U.S. telecom providers for progress.

Overnight, JP Morgan downgraded Nokia to “neutral” from “obese”, citing a likely loss of business enterprise with Verizon.

“We believe that there is a genuine hazard Verizon will count a lot less on Nokia as their major RAN (radio accessibility community) supplier going ahead,” JPM mentioned in a observe, adding there have been indicators Verizon was utilizing Samsung.

“Contemplate the JPM report on the Verizon-Nokia problem is based on some details. So significantly, Verizon ran some exams with its vendor for its 5G RAN and I’ve listened to that Samsung did better than Nokia,” explained a Seoul-primarily based analyst, who declined to be named.

Nokia reported it ongoing to perform with Verizon in 5G.

“Nokia is happy to provide Verizon, and we are fully commited to continuing to support them build the ideal, most responsible and highest performing network,” Nokia spokesman said.

Nokia, which axed its dividend following a income warning past October, has been seeking to rein in costs and handle delays in shipments as it makes an attempt to keep up with rivals in 5G.

Shares in Nokia ended up 7.4% lessen at 3.71 euros in midday investing.

Samsung said it does not remark on speculation.

(Reporting by Supantha Mukherjee in Bengaluru, Heekyong Yang in Seoul and Tarmo Virki in Tallinn, editing by Louise Heavens)