Nokia cuts losses, beats sales estimates

Nokia shares surge on results despite posting third quarter losses.

Nokia

Nokia today revealed third quarter financial results indicating it is stemming its losses in advance of launching its first Windows-based phone next week.

The Finnish handset maker posted a net loss of 151 million euros (132m) in the three months to September on 322m of profit over the same period.

It also said third-quarter revenue fell by 13 per cent to 9 billion (7.9bn), including the sale of 16.8 million smartphone devices, which also dropped 38 per cent on the previous year.

Nokia needs to get back into the high end of the market to drive brand value and more importantly margins.

Compared to the same period last year, the volume of its non-smartphone handsets sold rose by 8 per cent to 89.8 million units, boosted by continued demand for its more basic models.

Despite the fact that overall handset shipments slid year-on-year three per cent to 106.6 million units, the results saw Nokia's share price surge on the news, as analyst estimates had forecast overall sales of 93.6 million phones.

While Nokia's shares have dropped 41 per cent during this year so far and its last quarter operating profit also declined by 41 per cent, its stock value was trading up nearly 8 per cent on today's reported figures at 4.82 per share.

By comparison, Apple this week reported it had sold 17.07 million iPhones in its third financial quarter, while it reportedly sold over 4 million iPhone 4S devices over its debut weekend.

Carolina Milanesi, Gartner research vice president, suggested the market had reacted favourably to Nokia's results because it had managed to stop the rot.

"Nokia is addressing the issues they have and they have stopped/stabilised their situation before starting to improve further into the fourth quarter," she told IT Pro via email. "I think this shows that Nokia is executing on its vision."

She added that Nokia's impending launch of its first handset based on Microsoft's Windows Mango operating system (OS) next week was crucial.

"Nokia needs to get back into the high end of the market to drive brand value and more importantly margins," Milanesi said.

In today's results Nokia indicated its operating margin in the fourth quarter 2011 would be somewhere between one and five per cent.

Featured Resources

The complete guide to changing your phone system provider

Optimise your phone system for better business results

Download now

Simplify cluster security at scale

Centralised secrets management across hybrid, multi-cloud environments

Download now

The endpoint as a key element of your security infrastructure

Threats to endpoints in a world of remote working

Download now

2021 state of IT asset management report

The role of IT asset management for maximising technology investments

Download now

Recommended

Nokia 5.3 review: A surprise package
Google Android

Nokia 5.3 review: A surprise package

22 Oct 2020
Nokia and NASA join forces to bring 4G to the moon
mobile networks

Nokia and NASA join forces to bring 4G to the moon

19 Oct 2020
Nokia simplifies Microsoft Azure integration
business communications

Nokia simplifies Microsoft Azure integration

16 Sep 2020
Best smartphone 2019: Apple, Samsung and OnePlus duke it out
Mobile

Best smartphone 2019: Apple, Samsung and OnePlus duke it out

27 Apr 2020

Most Popular

Do smart devices make us less intelligent?
artificial intelligence (AI)

Do smart devices make us less intelligent?

19 Oct 2020
Politicians need to stop talking about technology
Policy & legislation

Politicians need to stop talking about technology

21 Oct 2020
Best MDM solutions 2020
mobile device management (MDM)

Best MDM solutions 2020

21 Oct 2020