Nokia loss widens in Q2 2012
Nokia, on Thursday (19 July), announced an operating loss of EUR 826 million in Q2 2012, from a prior loss of EUR 487 million in 2011 and a loss of EUR 1.34 billion in Q1, 2012.
Net sales of EUR 7.5 billion was only marginally higher than EUR 7.4 billion in Q1 2012.
Nokia said that Lumia Q2 volumes increased quarter-on-quarter to four million units, but devices and services in Q2 net sales decreased 5% quarter-on-quarter.
Mobile phones Q2 volumes increased quarter-on-quarter and year-on-year to 73 million units.
The group said it ended Q2 with gross cash of EUR 9.4 billion and net cash of EUR 4.2 billion.
Commenting on the Q2 results, Stephen Elop, Nokia CEO, said: “Nokia is taking action to manage through this transition period. While Q2 was a difficult quarter, Nokia employees are demonstrating their determination to strengthen our competitiveness, improve our operating model and carefully manage our financial resources.
“We shipped four million Lumia Smartphones in Q2, and we plan to provide updates to current Lumia products over time, well beyond the launch of Windows Phone 8. We believe the Windows Phone 8 launch will be an important catalyst for Lumia.”
He opined that during the quarter, Nokia demonstrated stability in its feature phone business, and enhanced its competitiveness with the introduction of the group’s first full touch Asha devices.
“We are executing with urgency on our restructuring program. We are disposing of non-core assets like Vertu. We are taking the necessary steps to restructure the operations of the company, which included the announcement of a new program on June 14. Faster than anticipated, we have already negotiated the closure of the Ulm, Germany R&D site, and the negotiations about the planned closure of our factory in Salo, Finland are proceeding in a collaborative spirit,” the company head said.
“We held our net cash resources at a steady level after adjusting for the annual dividend payment to our shareholders. While Q3 will remain difficult, it is a critical priority to return our Devices & Services business to positive operating cash flow as quickly as possible,” Elop said.
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