Nokia stops smartphone sales drop in Q3, but it’s now No.3 behind Samsung and Apple
Nokia has just announced its financial results for the third quarter of this year (the one which ended in September). Things are, of course, bad, but they’re not quite as bad as expected in some areas.
Nokia’s results aren’t anything to write home about because the company is undergoing a transition. Back in February it announced that it’s embracing Microsoft’s Windows Phone mobile operating system, and planning to phase out Symbian and MeeGo. The first WP devices from Nokia are due to be announced later this month, so it’s certainly understandable that device sales aren’t going very well in the meantime. Let’s dig in.
Nokia sold 16.8 million smartphones in this quarter, which is 34% less than in the year-ago quarter, and (perhaps rather surprisingly) 1% more than during the second quarter of 2011. Of course, the market overall grew by a lot more than that this quarter, so in terms of market share Nokia is still losing. Yet it’s nice to see that at least in absolute numbers, Nokia’s downfall in smartphones seems to have stopped. And with Windows Phone-based devices coming out in the fourth quarter, we may actually see sales start growing by the end of the year.
Nokia sold 89.8 million featurephones this quarter, 8% more than last year and a whopping 25% more than last quarter, so all seems to be once again fine in that division.
Nokia posted an operating loss of €71 million this quarter, which is bad, but considerably better than the €487 million loss from a quarter ago. Non-IFRS numbers are, of course better, with a €252 million operating profit for Q3, which is smaller still than last quarter’s €391 million. Net sales were at €8.98 billion, down 13% year-on-year and down 3% from Q2.
However, the better than expected results probably come because of aggressive price cutting. The Average Sales Price (ASP) for Nokia smartphones was €131, 8% less than last quarter and 2% less than last year. The featurephone ASP was €32, down 11% compared to Q2, and 20% compared to one year ago.
According to the WSJ, Samsung has sold more than 20 million smartphones in the third quarter, which, if true, means that the Korean company has now become the No.1 smartphone maker worldwide. It’s followed by Apple (which sold 17.07 million smartphones in Q3) and Nokia, which has fallen to No.3, a position that would’ve felt impossible just a couple of years ago. Such is the amazing pace at which the mobile world moves these days, unfortunately for Nokia.
Still, the Finnish company’s prospects are better for Q4. Its new WP devices will become available in some markets and may have a (very) positive impact on sales numbers, profits, as well as ASP. Whether or not Nokia will be on an upward trend in the long run remains to be seen though, and it mostly depends on how consumers will react to Nokia’s new Windows Phones. We’ll probably know for sure if switching to WP was a good idea by the middle of next year.