Nokia writedowns wipe out profits
Numbers, margins and services all slumpy
Nokia lost €426m before tax in Q3 this year, as writedowns, a deflating global economy and freefalling American sales all took their toll.
That loss compares pretty badly to last year's pre-tax profit of more than €1.5bn. It comes on the back of 20 per cent drop in sales to $9.8bn. Margins on the sales it did make slipped by 3.1 per cent to 30.9 per cent.
Devices and Services share the blame with Nokia Siemens Networks for the sales slide. Nokia shifted 108.5 million devices between July and September, a drop of eight per cent on last year, while even Nokia admits the world market only dropped around seven per cent.
The NAVTEQ division saw a modest rise in sales of 5.7 per cent, but that's small potatoes. And the unit made a bigger loss than last year
Nokia Siemens Networks had a particularly grim old time: net sales down by 21 per cent and a €908m write-down on the unit contributing to the unit's overall operating loss of €1.1bn, and thereby blowing the whole firm's profits out of the water.
Ignoring the writedown and other charges, the firm reckons it would have reported operating profits of €741m, still 57.8 per cent down on the year.
Back in devices it's clear that the USA just isn't buying Nokia, with North American sales down 31.1 per cent on last year compared to a marginal European drop of 1.1 per cent. Overall the company's world share remains around 38 per cent, thanks to other companies experiencing even lower sales in Latin American, Africa and the Middle East, so worldwide Nokia remains the mobile phone of choice.
Olli-Pekka Kallasvuo, Nokia's CEO, tried to soften the blow by talking about component shortages and expense management, but it's hard to disguise such grim realities.
Kallasvuo expects industry mobile volumes to move up in the fourth quarter, with Nokia's share holding steady.
But that's still in a market that will be down 7 per cent on the eyar to 1.12 billion units. Still, last time around Nokia thought the total decline would be 10 per cent. ®
yeah sure, YOU believe that won't you.
The real issue with US sales is that they are always late in getting the devices the consumer wants in the US. You will see the devices over in Europe a few months prior and then some of what they sell in the US won't even support the US 3G bands; or just some of them. Buy a phone from Europe and you get a two-year warranty; only one year in the US.
sinking, rats, ship??
Seems like that Wylie bloke (MyBestfriend's-Simon) has had his job outsourced to India. Or at least, a curry-guzzler with the instantly forgettable name of - er - google - Rajeev Suri. Now, tail firmly stuck between legs the wily coyote is slinking off the whole telecomms scene.
Looked S.B-W up on Forbes, €2m + salary, including increments and excrements.
Not bad for being the architect of a completely disastrous merger with part of Siemens, which almost didn't go through due to Siemens managers' bribes. The guy looks like a twat, talks like a twat, makes business decisions like a twat, therefore....he's a witch/duck/twat!! Whatever.
I knew when the merger was announced in June, 2006 that it was disastrous. Did they ask me? Did they fuc*k! I'm older than Simon or Mahatma Whats-his-face, and have been in telecomm a helluvalot longer.
Not surprised one of the parent companies (Nokia) wrote off the 'goodwill'. There aint any.
How to screw up a good, profitable company. Sheesh!