Nokia reports £512 million loss after huge write-offs
Sales sank by almost a fifth
By Mikael Ricknäs | Published: 14:33, 15 October 2009
Nokia reported a third-quarter loss of €559 million (£512 million) that it blamed on charges related to its Nokia Siemens business. Sales of €9.8 billion were down 20 percent compared to last year, the company said on Thursday.
The main reason for the loss is a €908 million (£832 million) impairment charge related to telecoms equipment division Nokia Siemens. It is also paying €29 million restructuring charge related to the infrastructure company, according to Nokia. Both tough competition and adverse market conditions played a part in Nokia Siemens' problems, it said.
On the handset side the company saw a decline in units sold year-to-year, but an improvement from the immediately previous quarter. Net sales fell to €9.8 billion compared with €12.2 billion a year ago.
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It sold 108.5 million mobile phones, down eight percent from a year ago. However, it sold five million more than during the second quarter. The company has seen improved demand in many markets, it said.
Nokia also expects mobile device volumes to increase in the fourth quarter of 2009.
Despite the decline in sales, Nokia's total mobile phone market share held steady at 38 percent and the average price per phone at €62, compared to the second quarter.
The phone vendor has begun to break out reporting of its smartphone and mobile computer sales, which totaled €3.1 billion during the third quarter. The average smartphone sales price was €190, up from €182 during the second quarter.
The increase in average sales price in the smartphone segment is most likely thanks to slightly higher volumes of the N97, according to Carolina Milanesi, research director at Gartner, who thinks that Nokia still has work to do in the high-end segment.
