Nokia has just published its Q2 results for this year and although they are still in loses, there are silver linings in the form of rise in Lumia sales and underlying profit by the Nokia Siemens Network.
The Finnish giant has reported an operating loss of EUR 115 million over revenues of Eur 5.695 billion. The Nokia Siemens Network once again posted profits and this time of 8 million Euros which made sure the losses were somewhat lower in the devices and services division. As we already know Nokia is buying off Siemens’ stake in their joint network venture that is NSN so that is sure to bring in more profits.
Nokia’s CEO Stephen Elop spoke on the results saying,
“We’re pleased to report an underlying operating profit for the fourth consecutive quarter on a group level. We benefited from another strong performance at Nokia Siemens Networks, which continued to deliver well against its focused strategy. With our recent announcement to purchase Siemens’ 50% stake in Nokia Siemens Networks, we believe we will create value for Nokia shareholders and look forward to strengthening Nokia Siemens Networks as a more independent entity.
In Devices & Services, our Mobile Phones business unit started to demonstrate some signs of recovery in the latter part of the second quarter following a difficult start to the year. Also, towards the end of the second quarter, we started to ship the Asha 501, which brings a new design and user experience to the highly competitive sub-100 USD market. While we are very encouraged by the consumer response to our innovations in this price category, our Mobile Phones business unit is planning to take actions to focus its product offering and improve product competitiveness.
In our Smart Devices business unit, we continue to focus on delivering meaningful differentiation to consumers around the world. We are very proud of the recent creations by our Lumia team, from the Lumia 520 – our most affordable Windows Phone 8 product which has enjoyed a strong start in markets like China, France, India, Thailand, the UK, the US and Vietnam – to the Lumia 1020, our star imaging product which we unveiled to the world last week. Overall, Lumia volumes grew to 7.4 million in the second quarter, the highest for any quarter so far and showing increasing momentum for the ecosystem. During the third quarter, we expect that our new Lumia products will drive a significant part of our Smart Devices revenue.”
The once strong point for Nokia that is the feature phone market is on a constant decline as they sold 53.7 million feature phones while in Q2 last year they had sold 73.5 million feature phones. Out of these 53.7 million devices, 4.3 million devices were Asha full touch phones. Hopefully the Nokia Asha 501 which brings an attractive design and brand new interface will make some good sales but i don’t think the feature phones sales will rise again considering that low end Android smartphones will get better and better.
The average selling prices have also fallen down considering the Lumia 520 is the most popular Windows Phone but hopefully the Lumia 925, 928 and the just launched 1020 will be able to make in impact in Q3 results and get the ASPs up.
The Lumia sales have risen to 7.4 million, which is 32 % increase from the last quarter which saw Nokia shipping 5.6 million Lumias which is good enough and hopefully the upward spiral will continue considering the Lumia 1020 will surely bring in some momentum.