Feeds

Nokia flogged 4m Lumias, still bled €826m this quarter

Plenty of money left in the bank, for now

Choosing a cloud hosting partner with confidence

Nokia managed to shift 4 million Lumia handsets in the second quarter of 2012, and while it didn't make money during the period, it isn't as broke as many had feared it would be.

Overall sales were down by almost 20 per cent compared to the same period in 2011, but despite predictions that cash reserves would dip below €4bn, Nokia has managed to hang on to €4.2bn to cover the cost of the "transitional period", having managed to close some facilities early and thus girded its loins for difficult times ahead.

Those 4 million Windows Phone-powered Lumias made up almost half of the 10.2 million "smart devices" shipped in the quarter, but that's down from 16.7 shipped in the same period of 2011 and still only a small proportion of the 73.5 million phones Nokia sold from April to June this year, a number which is up slightly when compared to the same period in 2011.

But despite that, Nokia's operating loss for the quarter runs to €826m, which is approaching twice what it lost in the same period last year. It's less than Nokia lost in the first three months of 2012, but the mobile business is extremely seasonable (few people buy phones in January) so year-on-year comparisons are the only useful ones.

Nokia points out that much of its spending has been on restructuring – ie, laying off staff and closing facilities – and that once one takes out all that non-recurring stuff then the loss reduces by more than half to give a non-IFRS operating loss of €327m, though applying the same formula to the 2011 figures turns them into a profit of €391m.

"Nokia employees are demonstrating their determination to strengthen our competitiveness, improve our operating model and carefully manage our financial resources," says the comment from CEO Stephen Elop. Steve also admitted that "Q2 was a difficult quarter" and that the company is "executing with urgency on our restructuring program[me]" – which is rarely a good thing.

And it doesn't look like things are going to improve any time soon. Nokia's existing Lumia range won't run Windows Phone 8, so the company reckons "the third quarter 2012 [will] be a challenging quarter in Smart Devices" as punters hold off to see what new hardware is coming, which means those cash reserves could be all important as Nokia tries to weather the storm and emerge within a few years as a very different company. ®

Top 5 reasons to deploy VMware with Tegile

Whitepapers

Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Getting started with customer-focused identity management
Learn why identity is a fundamental requirement to digital growth, and how without it there is no way to identify and engage customers in a meaningful way.
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?
Reducing the cost and complexity of web vulnerability management
How using vulnerability assessments to identify exploitable weaknesses and take corrective action can reduce the risk of hackers finding your site and attacking it.
Top 5 reasons to deploy VMware with Tegile
Data demand and the rise of virtualization is challenging IT teams to deliver storage performance, scalability and capacity that can keep up, while maximizing efficiency.