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Nokia eyes turnaround with new CEO, dividend

Published on NewsOK Modified: April 29, 2014 at 10:52 am •  Published: April 29, 2014

HELSINKI (AP) — Nokia is planning for a turnaround now that it has sold its lossmaking handset business to Microsoft, naming on Tuesday a new CEO, promising to pay dividends again and laying out its vision for its remaining operations.

For the first quarter — the last for which it will include figures for its cellphones unit — Nokia said its net loss was 239 million euros (173 million) compared with a loss of 272 million a year earlier. Revenue fell to 2.6 billion euros from 3.1 billion euros, with mobile device sales plunging 30 percent.

To lead the Finnish company in its focus on the remaining businesses of networks, software, and maps, it named Rajeev Suri, the Indian-born former head of Nokia Solutions and Networks, to become CEO on May 1. The 46-year-old, who joined Nokia in 1995, has been largely credited with a turnaround in the company's networks sector.

Nokia Corp.'s shares closed up 3 percent at 5.29 euros on the Helsinki Stock Exchange.

Neil Mawston from Strategy Analytics said that a "relief factor" partly explained the increase in the company's share price.

"The burden of old Nokia has gone and it's a fresh start with the new Nokia," Mawston said.

Nokia, which completed the 5.44 billion-euro sale of its troubled devices and services unit and a license to a portfolio of patents to Microsoft Corp. last week, said it plans to invest 5 billion euros to "optimize its capital structure," including paying 1.8 billion euros in dividends for 2013 and 2014.

Suri gave an upbeat forecast, saying Nokia will continue expansion of its networks business, which serves 90 of the world's 100 largest operators, and focus on its mapping services for car navigation systems, where it has an 80 percent market share with its HERE maps.

The technology division will further invest in improving its innovation portfolio and explore new technologies with a team that includes hundreds of scientists and engineers.

"Nokia's strategy is to develop its three businesses in order to realize its vision of being a technology leader in a connected world and, in turn, create long-term shareholder value," said Suri, who described Nokia as one of the world's largest software companies.

He also said Nokia was set to negotiate new contracts concerning its licenses.

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