Nokia reports USD 1.27 billion Q3 loss; Lumia sales see decline too
Nokia has announced its third quarter earnings for 2012, with a reported loss of $1.27 billion (€969 million). In the corresponding quarter last year, Nokia had reported a loss of €68 million. Revenues are down by 19%, and are pegged at €7.2 billion.
“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. In Q3, we continued to manage through a tough transitional quarter for our smart devices business as we shared the exciting innovation ahead with our new line of Lumia products,” said Stephen Elop, CEO, Nokia
“In our mobile phones business, the positive consumer response to our new Asha full touch smartphones translated into strong sales. And in Q3, our mobile phones business delivered a solid quarter with sequential sales growth and improved contribution margin.”
Despite sounding fairly bullish about the market trends, Nokia’s smartphone sales are in a sharp decline. This quarter saw just 2.9 million Lumia devices sold, compared to 4 million the quarter before. This is a 28% decline over two successive quarters. In North America, the quarter on quarter sales saw a 50% decline, with 300,000 devices being sold. The sales in Q2 were 600,000.
It is definitely not a surprise that Lumia smartphone sales are down, specifically. The new Windows smartphone OS version is arriving at the end of this month, and Nokia is expected to launch the new range of Lumia phones in early November. What impacted sales in Q3 was the clear announcement that none of the current Lumia phones will get the upgrade from Windows Phone 7.5 to Windows 8 phone.
This is pretty much the make or break quarter for Nokia, and if it doesn’t claw back some of the losses with the new Lumia phones, it will pretty much lose the smartphone battle. Competing with the Chinese vendors with the Asha feature phone series may not be the most ideal scenario in the long run.
Also read,