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Nokia lowers its first quarter outlook

Three per cent revenue slump expected
Wed Apr 11 2012, 15:43

FINNISH PHONE GIANT Nokia has warned that its first quarter financial results could fall short of its original forecast, as the firm's Windows Phone strategy continues to struggle.

In a statement, Nokia said that it expects first quarter revenues to plunge by three per cent, despite previously expecting to break even. It warned that it expects a similar decline in the second quarter too, due to a decline in gross margins and what it called "competitive industry dynamics".

Nokia CEO Stephen Elop said, "Our disappointing Devices & Services first quarter 2012 financial results and outlook for the second quarter 2012 illustrates that our Devices & Services business continues to be in the midst of transition."

"Within our Smart Devices business unit, we have established early momentum with Lumia, and we are increasing our investments in Lumia to achieve market success. Our operator and distributor partners are providing solid support for Windows Phone as a third ecosystem, as evidenced most recently by the launch of the Lumia 900 by AT&T in the United States."

Some good news came from today's announcement though, as Nokia revealed that it shifted two million Lumia phones in the first quarter. While these are by no means figures to rival those of the Samsung Galaxy S II, it shows that the flailing phone maker is finally growing in market presence.

"Nokia has seen sequential growth in Lumia device activations every month since starting sales of Lumia devices in November 2011," the company said. "Lumia has gained market share with both distribution partners and consumers."

Whether that sales growth will catch up with the competition remains to be seen, however. Android smartphone makers are selling two million devices about every three days, not three months. µ


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