Nokia Q2 profits down by 62pc

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Nokia posted net sales of €9.912 billion across all its business units in the second quarter, to June 30, 2009, of which €6.586 billion, or 66 per cent, came from handsets and services.

The figure is down almost 25 per cent on last year, from 13.151 billion in the same period in 2008.

Shipments to the Americas were worst hit, with sales in Latin America down 41.8 per cent annually to 8.9 million and sales in North America down 28.9 per cent to 3.2 million.

Its market strongholds, in Europe and Asia Pacific, were also hit, and were down year-on-year by 14 per cent and 16.8 per cent to 23.3 million and 30.3 million units repsectively.

Profit was €775 million in the quarter, down 62.3 per cent from €2.054 billion in Q2 2008. Devices and services earned €802 million, down 56 per cent from €1.824 billion.

Its infrastructure business recorded just €2 million profit, down 99 per cent from €274 million.

Both units, however, saw an improvement sequentially, with Q2 sales across all Nokia’s business up 6.9 per cent on Q1 and Q2 profits up 50.8 per cent.

Nokia said it expected industry mobile device volumes of 268 million units, down 12 per cent year-on-year and up five per cent sequentially. It expects Nokia shipments to reach 103.2 million unit, down 15 per cent annually and 11 per cent sequentially.

It said its share of the global market stood at 38 per cent in Q2, down from 40 per cent in the same quarter last year and up from 37 per cent last quarter. Average selling price was €62, down from €65 in the first quarter.

Nokia chief executive Olli-Pekka Kallasvuo said: “Nokia put in a solid performance in what was another tough quarter. We increased our share of the global mobile device market sequentially to an estimated 38 per cent and grew our smartphone market share to an estimated 41 per cent.

“As a result of strong operational execution, underlying operating margins improved sequentially in all segments. Competition remains intense, but demand in the overall mobile device market appears to be bottoming out. As before, we are continuing to tightly manage our operating expenses.

“We are balancing short-term priorities with our longer-term growth ambitions as elements of the mobile handset, PC, internet and media industries converge to form a new industry. Consumers will increasingly expect devices and services designed as integrated solutions. To capture this opportunity we are accelerating our strategic transformation into a solutions company.”

 

 

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