Nokia Corp. (NOK) - Get Report shares traded sharply lower Thursday after the telecoms equipment maker posted a surprise first quarter loss, even as the group held onto its full-year profit targets ahead of an anticipated ramp-up of 5G networks around the world.

Nokia posted a loss of €59 million ($65.8 million) for the three months ending in March, compared to a Street forecast of a €305 million profit and a prior year figure of €239 million.  Quarterly revenues came in at €5.03 billion, Nokia said, rising 2% from the same period last year and essentially matching the consensus forecast, and group cash flow was pegged at -€913 million. 

Looking into 2019, Finland-based Nokia maintained its forecast for earnings in the range of €0.25 to €0.29 per share, a figure it expects to improve to between €0.37 and €0.42 euros by 2020 as new 5G orders are booked in the anticipated 5G rollout.

"Q1 was a weak quarter for Nokia. We expected that it would be, and the outcome has not changed our perspective on the full year," said Nokia CEO Rajeev Suri. "We are confident that those issues that drove weakness in our results will ease over the remainder of the year. While overall risks have increased slightly, we continue to see positive developments and are maintaining our guidance for the full year."

"Competitive intensity has slightly increased in certain accounts as some competitors seek to be more commercially aggressive in the early stages of 5G and as some customers reassess their vendors in light of security concerns, creating near-term pressure but longer-term opportunity," he added. "We will continue to take a balanced view, and are prepared to invest prudently in cases where there is the right longer-term profitability profile."

Nokia shares fell 9.33% in the opening hours of trading in Helsinki at €4.671 per share, while its U.S.-listed stock was marked 9.5% lower in pre-market trading in New York at $5.24 each.

Suri's reference to competitive intensity was evident this week in the United Kingdom, where  Prime Minster Theresa May looks set to allow Huawei Technologies to participate in the build-out of the country's 5G infrastructure while restricting the controversial China-backed group from access to "core" parts of the next generation network.

Britain's Daily Telegraph National Security Council, which is chaired by the Prime Minister, will allow Huawei to build portions of the network, while baring it from others, amid concerns that the group may assist the Chinese government in digital espionage.

President Donald Trump has been pressing European allies -- as well as the so-called "Five Eyes" alliance of English-speaking economies that share intelligence -- to bar Huawei from participating in 5G network construction.

"It's essential that we get the balance right, ensuring that our networks are built in a way that is secure against interference from whatever source, but also are competitive," U.K. Finance Minister Philip Hammond told a panel of lawmakers Wednesday. "But where our security experts tell us that there are ways in which we can maintain security -- whether it's in networks or installations -- that avoid the most economically costly outcomes, then we should look very carefully at those options."