Nokia slashes Q1 losses, but sales shrink
Nokia cut its first quarter net loss to €272 million ($354.9 million), from €928 million a year earlier, but also reported a 25% quarter-on-quarter slump in devices and services revenue.
The company announced that its cost-cutting and turnaround efforts had improved its cash position and underlying profitability during the quarter.
But devices and services net sales fell to €2.9 billion, and mobile phone sales volumes fell 30% quarter-on-quarter to 55.8 million units.
Sales of Nokia's Lumia smart device line by contrast grew 27% to 5.6 million units over the same period. CEO Stephen Elop said consumers are “responding positively to the Lumia portfolio, and our volumes are increasing quarter over quarter.”
He said the company is also taking action to address the “difficult competitive environment” faced by its key feature phones business.
The first quarter results also show that Nokia achieved underlying operating profitability for the third straight quarter, and NSN for the fourth consecutive quarter.
While the company is predicting it will increase sales growth from its Lumia line in the second quarter, it still expects a negative operating margin for its devices and services unit, due in part to heavy market competition and the macroeconomic environment.