Apple Pays Nokia €1.7 Billion For Patent Use

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Apple appears to have paid Nokia a total of €1.7 billion in a one off deal regarding patent use. Nokia originally announced back in May that it had struck a deal with Apple regarding its use of various Nokia-owned patents. At the time, it was simply stated that Nokia would eventually receive a one-off payment from the American giant, but no specific amount was stated by either company.

With the release of Nokia's second quarter results for the year, though, the Finnish company has finally revealed the amount and it's certainly not a small sum. In its financial report, the company stated that it had received an "upfront cash payment of €1.7 billion" and, when contacted for clarification regarding the payment, a representative of the company confirmed that it was in fact from Apple. But not all of the sum was included in the second quarter, with the rest set to be included in the third quarter report. The one-time payment is only a small part of the deal struck between the two companies, though. Alongside this, Apple will also continue to pay royalties for any patents it uses that are owned by Nokia and has agreed to carry on selling Nokia-branded health products within its retail locations and online stores. In the meantime, Nokia will supply the American company with network infrastructure products and services. Aside from Apple, Nokia also managed to strike a licensing deal with Xiaomi which the CEO stated was a "milestone win" for Nokia. Thanks to the deal, the company is expected to expand into China over the coming years, something that is expected to help increase profits.

For now, though, the deal with Apple has led to a huge surge in profits of 77 percent, which saw the figure reach €574 million. As well as this, revenues were down 1 percent to €5.6 billion. For the rest of the year, though, the company has readjusted its estimates, with Nokia now expecting a decline of between 3 and 5 percent overall due to challenging market conditions. Although things aren't looking too positive for the rest of 2017, the company is betting on 5G technology in the long run which, when deployed in the coming years, could lead to significant growth at the company.

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