Nokia Quarterly Loss Deepens As Handset Sales Decline
Nokia has announced that its third-quarter sales dropped by 19 percent compared to a year ago, and were also down slightly compared to the previous three months. The company reported net sales of EUR7.24 billion (US$9.5 billion), while the operating loss deepened from EUR71 million a year ago to EUR576 million (US$755 million) in the past three months.
In the third quarter 2012, Nokia received a quarterly platform support payment of US$250 million from Microsof for using its operating system in their smartphones.
Nokia ended Q3 with gross cash of EUR 8.8 billion and net cash of EUR 3.6 billion.
Commenting on the Q3 results, Stephen Elop, Nokia CEO, said: "As we expected, Q3 was a difficult quarter in our Devices & Services business; however, we are pleased that we shifted Nokia Group to operating profitability on a non-IFRS basis."
"And, Nokia Siemens Networks had a remarkable quarter in which we achieved record profitability on a non-IFRS basis and the Nokia Siemens Networks cash balance increased for the fourth quarter in a row."
"While we continue to focus on transitioning Nokia, we are determined to carefully manage our financial resources, improve our competitiveness, return our Devices & Services business to positive operating cash flow as quickly as possible, and ultimately provide more value to our shareholders."
The company posted declining mobile sales across all markets, with the USA and China particularly badly hit. Overall mobile phone sales revenues fell by a third compared to a year ago.
Looking ahead, the company said that it expects the fourth quarter 2012 to be a challenging quarter in Smart Devices, with a lower-than-normal benefit from seasonality in volumes, primarily due to product transitions and the ramp up plan for new devices.