Nokia profits still dipping despite strong Lumia sales

Can Nokia ride the 900 to glory?

On April nineteen, Nokia is expected to release their Q1 results. As a precursor, they put out some initial figures, showing that despite relatively strong sales, their profits keep to shrink. Nokia totaled €4.2 billion in phone sales, the bulk of which consisted of 71 one thousand thousand characteristic phones, Nokia's one-time breadstuff and butter, bringing in around €2.3 billion. Smart devices earned them almost €1.seven billion. And fifty-fifty though these seem like pretty big numbers, they are not enough to encompass the cost of moving over to the Windows Phone platform in an effort to gain a foothold in the smartphone arena. The expected result is a beginning quarter terminate three percentage below the break-even mark.

Simply this doesn't mean all doom and gloom for Nokia. Sales of Nokia'southward Lumia line of phones has been solid and continue to increase. The Lumia 900 has gotten off to a quick starting time and doesn't show whatever signs of slowing all the same. And neither does Nokia CEO, Stephen Elop. He says that he and his coiffure go on "to increase the clock speed of the company" and that "the change is tangible." Considering that they scrapped their previous operating organization in favor of Microsoft's but nether a year ago, and that their first devices but hit the market place concluding quarter, it's difficult to phone call a 3 pct loss a failure.

Read the presser after the interruption.

Source: Nokia

Nokia lowers Devices & Services first quarter 2022 outlook and provides second quarter 2022 outlook

Hard fiscal operation reflects company in transition

Positive early momentum in Lumia smartphone strategy

Nokia Corporation
Stock commutation release
Apr eleven, 2022 at 15.00 (CET+1)

Espoo, Finland - Nokia today provided preliminary information on certain aspects of its first quarter 2022 fiscal performance, including a lowered first quarter 2022 outlook for Devices & Services. During the commencement quarter 2022, multiple factors negatively affected Nokia'southward Devices & Services business to a greater extent than previously expected. These factors included:

- Competitive industry dynamics, which negatively affected cyberspace sales in the Mobile Phones and Smart Devices business units, particularly in Republic of india, the Middle East and Africa and China; and
- Gross margin declines, particularly in the Smart Devices concern unit of measurement.

The impact of these factors on the non-IFRS Devices & Services operating margin in the kickoff quarter 2022 was partially offset past a significant benefit from lower warranty costs.

Updated outlook for Devices & Services for the first quarter 2022:
Nokia currently estimates that its non-IFRS Devices & Services operating margin in the first quarter 2022 was approximately negative iii percent, compared to the previously expected range of "around breakeven, ranging either above or below by approximately 2 percentage points" primarily due to the factors noted in a higher place.

Outlook for Devices & Services for the second quarter 2022:
Nokia expects its not-IFRS Devices & Services operating margin in the 2nd quarter 2022 to exist similar to or below the kickoff quarter 2022 level. This outlook reflects that the first quarter 2022 benefit related to lower warranty costs is expected to be not-recurring, besides as expectations regarding a number of factors including:

- competitive industry dynamics standing to negatively bear upon the Smart Devices and Mobile Phones business units;
- timing, ramp-up, and consumer demand related to new products; and
- the macroeconomic surroundings.

"Our disappointing Devices & Services first quarter 2022 fiscal results and outlook for the second quarter 2022 illustrates that our Devices & Services business continues to be in the midst of transition," said Stephen Elop, President and CEO of Nokia. "Within our Smart Devices business unit of measurement, we have established early momentum with Lumia, and we are increasing our investments in Lumia to achieve market success. Our operator and benefactor partners are providing solid support for Windows Phone equally a third ecosystem, as evidenced most recently by the launch of the Lumia 900 by AT&T in the United States."

Additional commentary on the first quarter 2022 for Devices & Services and Nokia:
Nokia currently estimates that Devices & Services net sales in the outset quarter 2022 were EUR 4.two billion, comprised of Mobile Phones net sales of EUR 2.three billion (71 1000000 units), Smart Devices net sales of EUR 1.7 billion (12 1000000 units), and Devices & Services Other net sales of EUR 0.two billion. Based on the preliminary view, Nokia ended the first quarter 2022 effectually the high end of our normal four to 6 calendar week channel inventory range, but on an absolute unit basis, channel inventories declined sequentially.

Nokia currently estimates that Devices & Services gross margin (including Devices & Services Other) for the beginning quarter 2022 was approximately 25%, with Mobile Phones gross margin of approximately 26% and Smart Devices gross margin of approximately 16%.

In the first quarter 2022, Nokia sold more than two million Lumia devices at an average selling price of approximately EUR 220 (reported inside the Smart Devices business unit). Furthermore, Nokia has seen sequential growth in Lumia device activations every month since starting sales of Lumia devices in November 2022. Lumia has gained marketplace share with both distribution partners and consumers. The Windows Phone ecosystem is also alluring developers and has expanded rapidly with more than lxxx,000 applications available.

Nokia currently estimates that at the terminate of the start quarter 2022, the company's gross cash and other liquid avails were approximately EUR 9.8 billion, and Nokia's net cash and other liquid assets were approximately EUR 4.9 billion. The sequential decline in cyberspace greenbacks and other liquid assets was driven by Devices & Services, which experienced unfavorable and mostly not-recurring net working capital changes also equally operating losses. Nokia Siemens Networks contributed positively to Nokia'southward greenbacks flow in the outset quarter 2022 due to net working capital improvements. This was despite Nokia Siemens Networks having a preliminarily estimated non-IFRS operating margin of approximately negative 5 percent in the showtime quarter 2022, in line with the previously provided outlook.

Deportment to Address Competitive Industry Dynamics Affecting Devices & Services
Nokia is quickly taking action. Nokia will continue to increment its focus on accelerating Lumia sales, as well every bit on lowering the company's cost construction, improving greenbacks menses and maintaining a strong financial position.

- In the Smart Devices business organization unit of measurement, Nokia is increasing investments in Lumia to bring more products to more consumers in more markets.
- In the Mobile Phones business unit, Nokia is taking tactical pricing actions in the near term and plans to bring new products to market in the 2nd quarter 2022.
- Nokia volition accelerate planned cost reductions and will pursue boosted significant structural deportment if and when necessary.

"Nosotros are continuing to increase the clock speed of the company," said Stephen Elop, President and CEO of Nokia. "The change is tangible, and we are proud of the manner Nokia employees are quickly responding to the needs of consumers and partners."

Nokia will provide full commencement quarter results and more details when it reports its first quarter 2022 results on April 19, 2022.

Nokia will be hosting a briefing call today at 13:30 United kingdom fourth dimension (8:30 EST). The dial-in number for media (heed only - the question and answer session will exist express to financial analysts and investors just) is +1 706 634 5012. Conference ID: 67681834.

The dial-in number for fiscal analysts and investors is United states: +1 888 636 1561. Conference ID: 67681834. UK: +44 1452 560 299. Briefing ID: 67997871.

A replay of the call will be available soon subsequently the telephone call completion. The replay number is U.s.a.: +1 800 585 8367. Conference ID: 67681834. United kingdom of great britain and northern ireland: +44 1452 55 0000. Briefing ID: 67997871.

Nigh NokiaNokia is a global leader in mobile communications whose products have become an integral role of the lives of people around the world. Every day, more than 1.iii billion people utilize their Nokia to capture and share experiences, access information, notice their way or but to speak to one another. Nokia's technological and blueprint innovations have made its brand i of the most recognized in the world. For more data, visit http://www.nokia.com/about-nokia

Nokia
Communications
Tel. +358 7180 34900
Email: press.services@nokia.com

Investor Relations Europe:
Tel. +358 7180 34927

Investor Relations US:
Tel. +1 914 282 0145

www.nokia.com

The AT&T version of Surface Duo is now getting Android 11

It's here

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