Nokia’s slide continues – reports Q2 losses of €487m

21 Jul 2011

Nokia’s struggles are continuing and the company has reported sales have fallen to €9.2bn from €10bn a year earlier, a 7pc year-on-year drop. Operating profits have plummeted, resulting in a loss of €487m, compared with a €295m profit a year ago.

In terms of device sales, smart device sales were down 32pc year-on-year and overall mobile phone sales were down 20pc.

The volume of phones sold declined 15pc to 71.8m units shipped while the total volume of smart devices shipped declined 34pc to 16.7m units.

This is in stark contrast to Apple, which this week reported 20.3m iPhones during its recent quarter, up 182pc year-on-year.

Nokia has been left with no choice but to hope its collaboration with Microsoft will produce a phone that will return it to growth.

‘Challenges greater than expected’ for Nokia

“The challenges we are facing during our strategic transformation manifested in a greater-than-expected way in Q2 2011,” CEO Stephen Elop said.

“However, even within the quarter, I believe our actions to mitigate the impact of these challenges have started to have a positive impact on the underlying health of our business. Most importantly, we are making better-than-expected progress toward our strategic goals.

“In Q2, our immediate action to manage unexpected sales and inventory patterns enabled us to create healthier sales channel dynamics, which led to greater business stability in the latter weeks of the quarter. Most notably, we took action in China and Europe to address an inventory build up that occurred in the first quarter of 2011,” Elop said.

Photo: Nokia CEO Stephen Elop

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years