Feeds

Nokia posts massive loss, blames 'ambiguity'

Horrific train crash at former world leader

Internet Security Threat Report 2014

Nokia posted a large operating loss of €487m today, only its second quarterly loss in 19 years. And without the royalty settlement with Apple it would have been much worse: the settlement gifted Nokia a one-time bonus of €430m.

"Our new strategy introduced ambiguity," admitted CEO Stephen Elop. The figures tell a story of unit sales and margins both crashing dramatically.

Smartphone units fell 34 per cent year-on-year, from 25.2 million to 16.7 million; non-smartphone unit shipments fell from 85.8 million a year ago to 71.8 million in Q2 2011, down 16 per cent. Overall, phone sales were down 20 per cent from Q2 2010.

It means Nokia lost its smartphone lead, as predicted, falling to third position behind Apple and Samsung. Net sales fell by 11 per cent QoQ and were 7 per cent down from a year ago.

Nokia reported a negative margin of 4.5 per cent (+6.7 per cent on a non-IFRS basis), confirming it was paying people to take its phones away.

Elop also confirmed the exploration of a private equity deal for Nokia Siemens Networks. The division looked relatively perky, compared to the bloodbath at the rest of the company. NSN posted a lower loss than a year ago, with net sales up 20 per cent to €3.642.

Nokia accounted for the negative margins by explaining that the company had to shift inventory for its unwanted phones that had built up in Europe and China. Yet even with the "giveaways", unit shipments fell 23 per cent in Europe, 30 per cent in Asia-Pacific, and 34 per cent in China.

The company also recognised significant changes taking place in the quarter as Elop takes an axe to the bureaucracy. Nokia says it is aiming for break-even margins by the end of Q3.

Elop confirmed that the orphan N9 Linux phone will be "regional" only, and that volume shipments of Windows-based devices won't materialise until next year. ®

Top 5 reasons to deploy VMware with Tegile

More from The Register

next story
Facebook pays INFINITELY MORE UK corp tax than in 2012
Thanks for the £3k, Zuck. Doh! you're IN CREDIT. Guess not
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
YARR! Pirates walk the plank: DMCA magnets sink in Google results
Spaffing copyrighted stuff over the web? No search ranking for you
Don't bother telling people if you lose their data, say Euro bods
You read that right – with the proviso that it's encrypted
Apple SILENCES Bose, YANKS headphones from stores
The, er, Beats go on after noise-cancelling spat
prev story

Whitepapers

Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.