In the ongoing financial period, global economic uncertainty may affect the demand for Bittiumīs services, solutions and products and provide pressure on e.g. pricing. In the short term such uncertainty may affect, in particular, the utilization and chargeability levels and average hourly prices of R&D services. Growing political uncertainty may also affect the demand for Bittiumīs services, solutions and products and the price competitiveness in the different geographical areas.
Bittiumīs customer base includes, among others, companies operating in the field of telecommunication, defense and other authorities, as well as companies delivering products to them, the company is exposed to market changes in these industries.
In October 2016, Bittium received information according to which a significant customer cooperation with a global mobile network equipment manufacturer will reduce during the year 2017. A significant part of Bittiumīs net sales has accumulated from selling R&D services to this mobile communications equipment manufacturer. The reduction of the cooperation did not have an effect on Bittiumīs outlook for the year 2016, but if the planned actions of the customer will materialize in full, these actions might have a negative effect on Bittiumīs net sales and operating result in 2017. A significant part of Bittiumīs net sales still accumulates from selling products and R&D services to defense and other authorities, as well as companies delivering products to them. Deviation in anticipated business development with such customer concentrations may translate as a significant deviation in the Bittiumīs outlook, both in terms of net sales and operating result, during the ongoing financial period and thereafter.
Bittium seeks to expand its customer base on a longer term and reduce dependence on individual companies and hence the company would thereby be mainly affected by the general business climate in the industries of the companies belonging to Bittiumīs customer base instead of the development of individual customer relationships. The more specific market outlook has been presented in this report in the "Market Outlook" section.
