Back in black: Nokia finally posts a quarterly profit, despite a massive 20% decline in handset sales
Finnish mobile phone giant Nokia has finally posted a quarterly profit, following six consecutive quarters of losses, despite a massive 20% year-on-year decline in mobile phone sales.
In results for the quarter ending December 2012, Nokia reported profits of €202 million, ($A258m) compared to a loss of €1.076 billion for the same quarter last year.
The company also reported gross cash of €9.9 billion and net cash of €4.4 billion, with net cash up €800 million during the quarter.
However, in the company’s key devices and services division, responsible for the Lumia series of Windows Phone-based smartphones, stood at €3.9 billion, up 8% sequentially but down 36% year-on-year.
Nokia revealed its overall mobile phone sales (including feature phones and smartphones) fell across the board, hitting 67.3 million in Europe for the year (from 87.8 million for 2011, a fall of 23%), 81.7 million in the Middle East and Africa (from 94.6 million, down 14%), Greater China 27.5 million (from 65.8 million, -58%), the Asia-Pacific 113.5 million (118.9 million, -5%), North America 2.2 million (3.9 million, -44%) and Latin America 43.4 million (from 46.1, -6%).
Total worldwide mobile phone sales for Nokia stood at 335.6 million units in 2012, down 20% from 417.1 million in 2011.
The year-on-year falls were particularly acute for its smartphone division, despite the introduction of the company’s new Windows Phone 8-based Lumia 820 and 920 smartphones, with volumes falling by 55% to 35.1 million units from 77.3 million units in 2011.
“The year-on-year decrease in our smart device volumes in 2012 was driven by the strong momentum of competing smartphone platforms relative to our Symbian devices. On a geographical basis, the decrease in volumes was due to lower volumes in Greater China, Europe, Asia Pacific, Middle East and Africa and Latin America, partially offset by slightly higher volumes in North America,” Nokia states in its quarterly report.
The news wasn’t much better at the company’s location and commerce division, responsible for its Nokia Maps products, reported net sales of €278 million, up 5% sequentially but down 9% year-on-year. That figure includes sales outside the Nokia Group of €204 million, up 14% sequentially but again down 2% year-on-year.
A rare bright spot was the company’s Nokia Siemens telecommunications equipment division, which reported net sales of €4.0 billion, up 14% quarter-on-quarter and 5% year-on-year.
Overall net sales for the group were down to €8 billion from €10 billion a year earlier, however this was made up for by a drop in the cost of sales to €5.4 billion from €7.1 billion a year earlier.