“Nokia Oyj, the world’s biggest maker of mobile phones, had its first net loss since the company began reporting quarterly in 1996, hurt by costs related to a joint venture with Siemens AG and on weaker demand,” Diana ben-Aaron reports for Bloomberg.
“The company reported a net loss of 559 million euros ($834 million), from a profit of 1.09 billion euros in the year- earlier period. Sales declined to 9.8 billion euros. Analysts in Bloomberg surveys had expected on average a profit of 367 million euros and sales of 10.03 billion euros,” ben-Aaron reports.
“The Espoo, Finland-based company took a goodwill writedown of 908 million euros on its Nokia Siemens Networks venture. Nokia said its handset market share was unchanged at 38 percent and will stay at that level in the fourth quarter, while smart- phone sales fell. Nokia’s N97 smart phones are being stacked up against Apple’s iPhone, which has access to the biggest collection of downloadable software and media,” ben-Aaron reports. “‘It’s not a great report,’ said Ben Rogoff, who helps manage about $2 billion including Nokia shares at Polar Capital Technology Trust Plc in London. ‘With Apple set to increase its presence in Europe and the N97 going into the channels, it was a good chance for them to really show what they could do, and the bottom line is they didn’t, and there was a revenue miss.'”
“The company sold 16.4 million smart phones, it said. Last quarter’s smart-phone sales were 16.9 million,” ben-Aaron reports.
Full article here.
MacDailyNews Take: And so, pushed over the edge by Apple’s iPhone, Nokia’s inexorable slide continues.
[Thanks to MacDailyNews Reader “Graeme” for the heads up.]
Wouldn’t be because of iPhone would it?
Heh, MDN can you say bloodbath? Come on, I know you can.
Monday will be very interesting.
Even based on the analyst projects a 3.67% profit margin does not make a sustainable company, It signals a company just limping alone hoping that they well maintain their market share. Companies that sell some of their products at below cost and let that eat away at their margins is just badly run. Just look at Sony once the world leading in consumer electronics let market share concerns eat away at it’s margins and now Sony is third and slipping to fourth very rapidly. Of course, Howard Stringer didn’t help any as he’s the most inept CEO in the world.
Nikia has less than 5 years to focus it’s business on dumb phones and forgo the smartphone area. They can focus on how to be a profitable high volume dumb phone company and become leaner and meaner.
Or they can go out of business trying desperately to be a smartphone company.
Either way 5 years max.
Let’s be fair here: Nokia had a one-time writedown on its Seimens joint venture, of 908M euros. If you back that out of its loss of 559M euros, then on their operating business they had a PROFIT of 349M euros. In comparison with expectations of 367M euros, they had a small miss.
You have to compare operational profit/loss vs operational profit/loss; otherwise you get screwed up interpretations. Now, having said that, some companies seem to have one-time losses every quarter, like Dell, and one should wonder whether those are really one-time losses at all.
Rather buy a Windows Phone anyday better than Crapple’s and some Finland company. More values are put in Windows than any other product out in the market.
http://www.bing.com When it comes to decisions that matter, Bing & Decide
WOW !!
38 percent market share !
iPhone has what 3 percent ? And only 50 percent of the profits ??
@Anonymous
Reminds me of back when Apple was struggling, it would make a one-off asset sale each quarter to put it in the black (or minimize the red).
@ I’m a PC
Microsoft employee in tha house!