Thursday, May 30, 2024

Nokia Reports Strong Sales of Lumia Smartphones

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Things may may finally be looking up at Nokia. The company reported surprisingly strong sales of its Lumia smartphones, sending the company’s stock sharply higher.

The Wall Street Journal’s Sven Grundberg reported, “Nokia Corp. on Thursday said brisk sales of its new Lumia smartphones have contributed to better-than-expected fourth-quarter earnings, sending its shares up sharply and delivering a sliver of optimism about a possible reversal of the company’s fortunes following six consecutive quarterly losses. Nokia shipped 4.4 million Lumia devices in the fourth quarter of 2012, bringing its total smartphone shipments to 6.6 million devices, the first increase in smartphone shipment numbers in a year.”

Matt Egan from Fox Business added, “Nokia, which is set to release full results in late January, said last quarter it generated 1.2 billion euros of smartphone sales…. Thanks to the robust sales, Nokia projected its fourth-quarter devices and services operating margin at between breakeven and 2%, compared with prior estimates for -6%, plus or minus four percentage points. At the same time, Nokia said its Nokia Siemens Networks beat expectations and posted record underlying profits due in part to improved cost management. The company now sees sales at 4 billion euros for this division and operating profit margin at 13% to 15%, compared with prior guidance for 8%, plus or minus four percentage points.”

Ritsuko Ando with Reuters noted, “Nokia shares were up 12.8 percent at 3.38 euros by 1558 GMT as investors cheered the rare positive announcement from Nokia. ‘I think it’s a good start,’ said Mirabaud Securities analyst Susan Anthony. But she, and other analysts, were slightly cautious on whether the Lumia strategy was really succeeding. ‘We still need evidence that the good initial momentum can continue and will not stall as happened with its Windows Phone 7 devices,’ she said.”

CNNMoney’s David Goldman recalled, “In the first quarter of this year, Nokia lost the title of ‘world’s largest cell phone company’ to Korean rival Samsung, ending a 14-year reign at top of the industry. Nokia was the worldwide smartphone leader as recently as a year ago, but it has since fallen out of the top five. Financial hardship followed as sales slumped. In April, Nokia’s debt was downgraded to a ‘junk’ rating by credit rating agencies Standard & Poor’s and Fitch. The company cut 10,000 jobs in June.”

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