Nokia Corporation’s Share Buyback Program: An Overview
On 6 March 2025, Nokia Corporation (Nokia) announced the acquisition of its own shares as part of its previously announced share buyback program. According to the stock exchange release, Nokia purchased a total of 3,854,165 shares across various trading venues, with a weighted average price of EUR 4.84 per share. This purchase is in compliance with the Market Abuse Regulation (MAR) and the authorization granted by Nokia’s Annual General Meeting in 2024.
Background:
In November 2024, Nokia’s Board of Directors announced the initiation of a share buyback program to offset the dilutive effect of new Nokia shares issued to the shareholders of Infinera Corporation and certain Infinera Corporation share-based incentives. The program, which started on 25 November 2024 and is set to end by 31 December 2025, aims to repurchase 150 million shares for a maximum aggregate purchase price of EUR 900 million.
Impact on Nokia:
The share buyback program represents Nokia’s commitment to returning value to its shareholders. By repurchasing its own shares, Nokia is reducing the number of outstanding shares and increasing the proportionate ownership of existing shareholders. This, in turn, could potentially lead to an increase in earnings per share (EPS) and a higher share price. Moreover, the buyback program demonstrates Nokia’s confidence in its business outlook and financial position.
Impact on Shareholders:
For existing Nokia shareholders, the share buyback program could result in several benefits. With fewer shares outstanding, each shareholder’s proportionate ownership of the company increases, which could potentially lead to higher dividends and capital gains. Furthermore, a lower number of shares could result in better liquidity for the stock, making it easier for investors to buy and sell shares.
Impact on the World:
The share buyback program’s impact on the world is not directly measurable, as it primarily affects Nokia and its shareholders. However, the program could indirectly impact the broader market by potentially influencing investor sentiment towards Nokia and the telecommunications industry as a whole. Additionally, Nokia’s share buyback program is an example of a trend among corporations to return capital to shareholders through share repurchases.
Conclusion:
Nokia’s share buyback program, which began on 6 March 2025, is an essential component of the company’s strategy to return value to its shareholders. By repurchasing its own shares, Nokia is reducing the number of outstanding shares, potentially increasing earnings per share and share price, and demonstrating confidence in its business outlook. The program’s impact on shareholders includes increased proportionate ownership, potential for higher dividends, and improved liquidity. While the program’s impact on the world is indirect, it could influence investor sentiment and contribute to the trend of corporations returning capital to shareholders through share repurchases.
- Nokia Corporation announces share buyback program to offset dilutive effect of new shares and incentives
- Program targets repurchase of 150 million shares for a maximum aggregate purchase price of EUR 900 million
- Nokia purchases 3,854,165 shares on 6 March 2025
- Share buyback program benefits Nokia and its shareholders
- Indirect impact on the world through investor sentiment and industry trends
