Nokia (NYSE:NOK) is one of the leading telecom network equipment vendors. The stock fell earlier in 2020 amid the widespread sell-off amid the coronavirus outbreak. However, at $4.20 per share, Nokia stock has recovered 80% from its pandemic lows.
Currently, Nokia is in the process of renewing its leadership. The company has made several high-profile executive appointments in recent months as it tries to revamp the business and its stock.
Nokia stock and executive shakeup
Besides the pandemic-driven sell-off that hit the broader stock market in the first quarter of 2020, Nokia stock has come under pressure due to weak financial results. The company suspended dividends last year to sort out its financial issues—mainly improving its cash position.
Nokia counts on a new executive team to turn around its fortunes and renew the stock’s momentum. On June 11, the company named Marco Wiren as its new CFO. Currently, Wiren is an executive at Wartsila Group, which is a leading provider of energy and marine technology solutions. He will take over from Nokia’s outgoing CFO, Kristian Pullola, in September.
Appointing Wiren almost completes the overhaul of the company’s top executives. Nokia already has a new chairman and a new chief executive who will take over in September. Pekka Lundmark will take over as the CEO in September and replace Rajeev Suri. Sari Baldauf took over as Nokia chairman last month and replaced Risto Siilasmaa.
In a statement, Nokia said that Lundmark picked Wiren to be the CFO.
Nokia’s new executives have their work cut out
The company derives most of its revenue from selling telecom network equipment. As a result, Nokia stock tracks the network business. The company has lagged behind the competition in the 5G market. The new leadership has the immediate task of accelerating Nokia’s 5G strategy.
Notably, Nokia’s 5G strategy suffered as the integration of Alcatel-Lucent, which it bought in 2016, presented challenges. Now, the integration work is a done deal.
The new leadership will likely fix Nokia’s financials quickly so that the company can bring back dividends. To strengthen its financials, Nokia focused on growing sales and cutting costs. Improving the financials is important for Nokia. The company aims to reach at least 2.0 billion euros in net cash before it resumes dividend payment. Nokia finished the first quarter with 1.3 billion euros in net cash.
Finally, Nokia stock has gained more than 50% over the past three months and 13% year-to-date.