Nokia says the Finnish company expects that revenue for the agreement will begin to be recognized in the fourth quarter of the current year.
China’s Huawei Signs Smartphone Patent Deal With Nokia
Nokia has signed a multi-year smartphone patent license deal with China’s Huawei, giving the Finnish company royalty agreements with all of the world’s largest handset makers, Reuters reported.
Nokia said last week it would start booking revenue, including a one-off catch-up payment, from the fourth quarter, the report said. The two companies did not provide further financial details of the agreement.
Nokia has recently struck licensing deals with handset makers including Apple, Samsung Electronics, LG and Xiaomi.
Nokia’s patent catalog covers technology that reduces the need for hardware components in a phone, conserves battery life and increases radio reception, among other features.
More than 90 percent of Nokia’s revenue comes from telecoms network equipment, but the licensing payments are highly profitable which is especially welcome as the network business is suffering an industry-wide slump.
Nokia’s shares increased 2.1 percent by 1415 GMT but are down around 14 percent over the year as a whole, the report said.
Nokia, which was the world’s largest cellphone maker a decade ago, withdrew from the handset market in 2014 but remains a major licensor of wireless technology, as well as a supplier of mobile and fixed-line network gear.
Huawei is the biggest maker of telecoms equipment by revenue and the world’s third largest maker of smartphones.