Visitors gather outside the Nokia booth at the Mobile World Congress in Barcelona, Spain, February 26, 2019. Photo: Reuters
Telecoms equipment maker Nokia is pulling out of the Russian market, going a step further than rival Ericsson, which said on Monday it was indefinitely suspending its business in the country.
According to Reuters, hundreds of foreign companies are cutting ties with Russia following its Feb. 24 invasion of Ukraine and after Western sanctions against Moscow.
While several sectors, including telecoms, have been exempted from some sanctions on humanitarian or related grounds, Nokia said it had decided that quitting Russia was the only option.
“We just simply do not see any possibilities to continue in the country under the current circumstances,” CEO Pekka Lundmark said in an interview.
He added Nokia would continue to support customers during its exit, and it was not possible to say at this stage how long the withdrawal would take.
Both Nokia and Ericsson made a low single-digit percentage of sales in Russia, where Chinese companies such as Huawei (HWT.UL) and ZTE have a bigger share.
Nokia does not expect this decision to impact its 2022 outlook but said it would lead to a provision in the first quarter of about 100 million euros ($109 million).
Russia is also at loggerheads with Finland and Sweden, the home countries of Nokia and Ericsson respectively, over their interest in joining the NATO military alliance.
Writing by Muzha Kucha