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STORY: Two telecoms giants showed the impact of slower consumer spending Friday (July 14).

Finland's Nokia was forced to cut its annual outlook.

While Swedish rival Ericsson reported a big drop in second-quarter profit.

Fears of a recession have forced businesses to cut their budgets.

That has hurt telecom gear makers like Nokia and Ericsson in their push for widespread 5G adoption and more broadband connections.

Nokia reported second-quarter sales of $6.4 billion - below analyst forecasts.

It now expects sales for this year to reach up to $27.6 billion - lower than previously forecast.

Ericsson reported a 62% fall in second-quarter adjusted operating profit, to $271 million.

That actually slightly beat market expectations.

The fall was driven by a slowdown in spending among operator clients, particularly in North America.

Ericsson predicts the market will see a 'gradual recovery' late this year due to growing demand for 5G.

Nokia shares dropped more than 9% in early trade - hitting their lowest in more than two years.

Ericsson shares were down almost as much.