Microsoft-bound Nokia business sees sales slide

Published on NewsOK Modified: January 23, 2014 at 10:57 am •  Published: January 23, 2014
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HELSINKI (AP) — The Nokia handsets business that Microsoft is due to take over saw sales continue to slide in the fourth quarter as its Lumia smartphones failed to draw business away from larger competitors like Apple and Samsung.

Shares in Nokia Corp. slumped Thursday after the company said it suffered a net loss of 25 million euros ($34 million) in the October to December period, with smartphone sales plunging 29 percent.

Nokia stock closed down more than 10 percent at 5.11 euros in Helsinki.

The devices and services unit, which will be transferred to Microsoft Corp., saw sales fall to 2.6 billion euros from 3.7 billion euros a year earlier. The unit recorded an operating loss of 198 million euros compared with a profit of 97 million a year earlier.

Nokia sold 30 million Lumia handsets in the full-year 2013, about twice as many as in 2012. It also unveiled several Lumia models, including its first large screen smartphones and its first tablet, the Lumia 2520.

But it failed to pose a challenge to the leaders in the lucrative smartphone sector, Apple Inc. and Samsung Electronics.

Neil Mawston from Strategy Analytics said the results were disappointing for the former industry bellwether, which has seen a steady decline since it commanded a 40 percent global market share of mobile phones in 2008.

"It was a bit of soft performance for Nokia in its final show," Mawston said. "The operating loss was the main surprise of the result."

In a strategic shift, Nokia teamed up with Microsoft Corp. in 2011 hoping to turn the downward trend but it has been further hit by competition from the lower end, by cheaper producers of mobile phones in Asia and China.

Last year, it agreed to a 5.4 billion-euro ($7.2 billion) sale of its ailing handset unit to Microsoft. Shareholders overwhelmingly approved the deal in November and it is expected to be closed during the current quarter, subject to regulatory approval.