Linked by Thom Holwerda on Tue 29th Oct 2013 15:04 UTC
PDAs, Cellphones, Wireless

Nokia has just announced its Q3 2013 financial results, revealing an operating profit of EUR118 million ($162 million) from EUR 5.66 billion ($7.8 billion) revenue. That's up massively year over year, but nonetheless represents another quarter of middling results. The report is the first since Microsoft agreed to purchase Nokia's phone business, and that division - Devices and Services - performed as expected, posting a small loss of EUR 86 million ($118 million).

So, Microsoft is buying the part of Nokia that is losing money, while the parts that make money remain in Finland. Seems like a good deal for Nokia-proper. In the meantime, Microsoft will be saddled with a devices division that is still losing money, and whose increase in sales consists largely of low-end, low-margin devices (like the 520). Interesting - especially since Windows Phone was supposed to prevent Nokia participating in a race to the bottom. I'm sure Microsoft's super-successful Surface division welcomes Nokia's devices division.

The cold truth: even more than 2.5 years after announcing the switch to Windows Phone, Nokia's Lumia range still cannot make up for drop in sales of Symbian devices and feature phones. This is roughly the same timeframe in which Samsung rose to the top. With Android.

Read into that what you will.

Permalink for comment 575793
To read all comments associated with this story, please click here.
RE[4]: Comment by Nelson
by Nelson on Wed 30th Oct 2013 10:23 UTC in reply to "RE[3]: Comment by Nelson"
Nelson
Member since:
2005-11-29

Nokia is losing money, but dramatically less money than say, a year ago. That is gradually improving as its device volumes improve and as its restructuring efforts taper off, as I said they would.

I had the audacity of suggesting that with their cash on hand back in 2011 they could

a) Weather the storm so go speak
b) Improve other divisions to improve the overall company financials
c) Improve D&S volumes to improve the profit margin

I don't reply to a lot of comments like your or the OP because they are a mischaracterization of my positions. I don't care what Nokia had 2 years ago, only what they have and where they're going with it.

But just to entertain that a little bit, the #3 position holder in smartphone volumes is LG with around 5% of the market.

Samsung and Apple control the big numbers and are pretty much the only ones who do. Surprise, surprise. They're the market leaders. Nokia isn't going to get there overnight, if at all.

What is incontrovertible is that Windows Phone is growing in many regions, especially important regions with low penetration. That is the exact same growth traits Android experienced in its early days. You don't simultaneously thrive everywhere, you have offshoots of success from place to place.

If we're going to set the bar every quarter at "They're not Samsung/Apple" then your comments pretty much go without saying and apply to every other OEM on this planet (though presumably you don't refer to their strategy as failures).

LG posted a loss this quarter on flat volume shipments. Nokia posted a profit on 20% growth. But Nokia is failing.

And a word about the sequential and YoY improvements. The argument about "its a small base" are meaningless now that they are in the same range as other OEMs.

Every quarter it becomes harder to post double digit gains, yet they keep doing it. They keep doing it while others do not.

Consider my reply to the OP a reply to your post above as well as pretty much the same things apply.

Reply Parent Score: 3