Nokia’s Q3 swung to a total €151 ($208.49/£132.13) million pre-tax loss after device sales slipped marginally and the company took hundreds of millions of euros in restructuring charges.
Last year, Nokia (NYSE: NOK) had made a €322 ($444.59/£281.75) million profit in the same period. But this time it absorbed charges totalling €323 ($445.97/£282.63) million, including a total €137 ($189.16/£119.88) million for restructuring, impairing and adjusting its handset division.
- Handset volume shrunk massively in North America (-79 percent from last year to just 700,000), and also fell in Europe (-29 percent) and even China (-21 percent).
- Specifically, smartphone volume is down 38 percent globally to 16.8 million, knocking 39 percent off the category’s revenue. The reason: “The strong momentum of competing smartphone platforms relative to our higher priced Symbian devices, as well as pricing tactics by certain competitors,” Nokia says.
- Volume of lower-end mobile phones is actually up eight percent, but revenue from them was down 14 percent after Nokia slashed their average selling price by a fifth.
Across the two categories, Nokia device shipments were down by only three percent. Revenue to the handset division was flattered by a one-off €70 ($96.65/£61.25) million from licensing unspecified intellectual property.
CEO Stephen Elop says the company will have spent €900 ($1242.63/£787.5) million on restructuring its handset business by 2012’s end. So far, it has spent €661 ($912.64/£578.38) million.
In a sign that Microsoft’s mapping functions may take hold, Nokia also wrote €113 ($156.02/£98.88) million off its Navteq acquisition, and €1 ($1.38/£0.88) million off Novarra, MetaCarta and Motally combined.