Nokia announces 2010 Q3 Results, Job cuts and Symbian plans

Mobile Phone Giant Nokia today announced the 2010 Q3 Financial Results. Nokia has posted a quarterly revenue of $14.3 billion (Euros 10.3 billion) and a net profit of $733.25 million (529 million euros). It’s worth noting that Nokia posted a net loss of 559 million euros 2009 Q3 quarter. This is the first financial result announced under Stephen Elop ever since he took over as the new CEO of Nokia. Beating the expectations of the analysts, nokia has posted better-than-expected results riding on the strong demand of cheap smartphones. Nokia shipped 110.4 million handsets this quarter, which is just 2% higher than the shipments made last year. Among the shipments made, 26 million handsets were smartphones. Nokia also reported that the total market size grew by 14% year or year. Considering this, the 2% increase in shipment is insignificant and in essence nokia is losing the market share. bu-nokia11_elop__0502212771 Stephen Elop had some grim news for the employees of Nokia as he made an announcement to lay off 1800 employees. He said, “In the five weeks since joining Nokia, I have found a company with many great strengths and a history of achievement that are second to none in the industry. And yet our company faces a remarkably disruptive time in the industry, with recent results demonstrating that we must reassess our role in and our approach to this industry”. “Some of our most recent product launches illustrate that we have the talent, the capacity to innovate, and the resources necessary to lead through this period of disruption. We will make both the strategic and operational improvements necessary to ensure that we continue to delight our customers and deliver superior financial results to our shareholders,” he added. In India, where Nokia was the undisputed market leader, the competition has been intense and growing. Nokia has lost significant market share to the new incumbants such as Micromax, Karbonn and to the emerging international brands such as Samsung and LG. Nokia has 3 major headaches. Loss of market share in emerging markets, Heavy competition in Smartphones segment and the Component Supply issues. It’s surprising that a company of Nokia’s stature with enormous bargaining power is facing the constraint in components supply. Couple of days ago, Apple posted its quarterly results. They had secured a net profit of $4.43 billion on the revenue base of $20.3 billion with a net profit margin of around 20%. While Nokia has managed only a profit of $733 million on the revenue base of $14.3 billion with a net profit margin of 5%. With a declining already-single-digit-profit-margin and with handful of market share issues and supply chain issues, Stephen Elop has lot of things to fix. It’s incredible that a global brand such as Nokia can manage only single digit profit margin! A tweet from Dean Bubley summarizes Nokia’s plight aptly

So: Nokia ships 26.5m smartphones across 20+ models. Apple does 14m on 2 models. RIM does 12m across 5 device families
Source Nokia also made another press release today stating that from now on Symbian will no longer have version numbers. There’s not going to be Symbian^4 or Symbian ^5. Instead it’s going to be a continuous evolution. They are apparently doing this to avoid extra marketing efforts to educate consumers about various operating systems and their benefits.
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