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Nokia Announces Fiscal Results, Promises Better Performance in Near Future

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ESPOO, Finland – The world’s largest handset manufacturer may be the maker of every third handset sold worldwide, but its recent run in the volatile smartphone segment has begun to hurt its performance.

In the fiscal results released early this week, the manufacturer declared a net sales of US$12.3 billion and an operating profit of US$1.08 billion for the first quarter of 2010. Comparing this to the year-ago quarter, the present quarter marks an increase by 2.6% in the net sales and 59.5% in the operating profit. However, the numbers paint a grainy picture when compared to the last quarter of 2009, which recorded 21% higher sales and 44% higher operating profit than the just concluded quarter. Not surprisingly, Nokia’s shares were down by 14% at the Helsinki Stock Exchange, the evening following the fiscal results announcement.

Though Nokia is the world-leader in terms of handsets sold and the range of markets it covers, the manufacturer has not been able to compete in the smartphone segment, in wake of increased competition from iPhone and Blackberry, along with the emerging Android-powered phones. Having burnt its fingers by shipping the unfinished N900, the sole Maemo 5-powered device from Nokia, the manufacturer has decided to hold back handset releases of Symbian^3, the latest platform from Nokia, which will power the upstream end of Nokia’s smartphones. However, the recent announcement of Symbian^3-powered Nokia N8 hints at the maturity of the latest platform from Nokia umbrella, which though not released in the market, is believed to have undergone through vigorous testing and benchmarking. The feature-laden N8 is the world’s first Symbian^3 powered device and is expected to start shipping in third quarter of this year.

Apart from holding back on unfinished products, Nokia has also slashed prices across its portfolio in a bid to attract more consumers to its handsets. The largest cuts to the tune of 10% were seen in the smartphone segment (mainly Eseries), where the manufacturer continues to lose to Research in Motion and Apple, who have emerged as the top players in the smartphone segment over the last couple of years.

Whether price-slashing and Symbian^3, slated for release in the third quarter of this year, will be able to save the sinking Nokia ship, remains to be seen.

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By , Chief International Correspondent on Apr 29th, 2010 GMT +2


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