Nokia Wins Patent Case Against Samsung, To Boost Revenue

Today, Nokia settled a long-standing dispute with business partner Samsung over wireless technology licenses, netting a cool $2.5 billion ($2.32 billion EUR) in projected sales following the deal.

Nokia said the arbitration verdict will boost its patent sales by hundreds of millions of euros.

But shares in Nokia and Alcatel – which Nokia is in the process of acquiring – slumped around 10 per cent after Nokia settled a patent dispute with South Korea’s Samsung.

“The International Court of Arbitration of the International Chamber of Commerce has issued its award for the binding arbitration between Nokia and Samsung”, Nokia said in a statement. Nokia’s dedicated patent unit, Nokia Technologies, says it expects sales of around €1.02 billion ($1.1 billion) in 2015 following the deal, with an additional €1.3 billion ($1.4 billion) in the years 2016 to 2018.

In 2014, Nokia sold its once-dominant phone business to Microsoft (MSFT.O), leaving it focused on telecoms network equipment while retaining a large portfolio of handset patents.

The 2015 revenues include catch-up revenue from the past two years. “Consistent with Nokia’s outlook, Nokia Technologies net sales for the full year 2015 are expected to increase year on year, even after excluding amounts related to the award”, it said.

Nokia has earlier announced a 15.6 billion euro takeover of French network gear rival Alcatel-Lucent, due to be completed this quarter.

Investor disappointment over the Nokia-Samsung settlement highlights the challenge that telecommunication manufacturers face in getting paid for their intellectual property at a time of stiff competition and consolidation in the cellphone market.

Apple recently came to a similar agreement with Ericsson and will be paying the company an undisclosed amount plus continuing royalties for seven years to use its patents. He expects to further collaborate with Samsung and other tech partners to explore more such licensing opportunities.