Tuesday June 14 06:05 pm
Nokia Settles All Patent Litigation, Enters Patent License Agreement With Apple
Nokia (NYSE:NOK) announced early this morning that it has entered into a patent licensing agreement with Apple (NASDAQ:AAPL) to settle a long-running dispute over patents the Finnish phone-maker holds. Specific financial details of the deal were not disclosed, but Nokia said the deal would boost its second quarter earnings. The company warned just two weeks ago that it would miss its targets due to slumping demand for its phones. Analysts said Nokia could be expected to get between 1% and 2% of iPhone revenues, which is quite substantial given the projected $43 billion in revenue the phone is expected to bring in this year. The structure of the deal, a one-time payment as well as running royalties, would suggest it was a good outcome for Nokia. The dispute goes back to October 2009, when Nokia sued Apple in the U.S., arguing the iPhone manufacturer was getting a "free ride" on technologies patented by Nokia. Apple has a potential upside of 39.8% based on a current price of $326.60 and an average consensus analyst price target of $456.54.