Nokia Sells Fewer Windows Phones, Posts Loss

Nokia (NYSE: NOK  ) isn't enjoying the smartphone surge nearly as much as Apple (Nasdaq: AAPL  ) and Google's (Nasdaq: GOOG  ) Android partners. Sales of its Lumia handset, based on Microsoft's (Nasdaq: MSFT  ) Windows Phone operating system, fell 28% from 4 million units in Q2 to just 2.9 million in the third quarter, the company announced today in its interim Q3 report.

Nokia lost 0.07 euros per share on an adjusted basis, a reversal from last year's 0.03 gain. Revenue fell 19% to 7.239 billion euros. In U.S. dollars, the figures amounted to a $0.09 loss on $9.48 billion in sales. Analysts had been calling for a $0.13-per-share loss on $9.03 billion in revenue, according to Yahoo! Finance data .

And yet the beat didn't matter. Shares of Nokia fell as much as 6% in early trading on what appeared to be discouragement over Lumia sales. In an interview with The New York Times, Pete Cunningham, an analyst with UK research firm Canalys, said he has begun to "doubt the Nokia comeback story."

For his part, Nokia CEO Stephen Elop told the Times that he believes users are yearning for an alternative to the iPhone and Android handsets. Nokia plans to fill the need next year, when it ships Lumia phones based on Microsoft's Windows Phone 8.

Separately, in the earnings press release , Elop said he and his team were still "transitioning Nokia." Elop joined the company from Microsoft two years ago. Shares of Nokia are down roughly 70% since.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Apple and Google at the time of publication. Check out Tim's web home, portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

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  • Report this Comment On October 18, 2012, at 4:04 PM, Krankor wrote:

    A point of correction. Nokia's Lumia smartphones with Windows Phone 8 will go on sale in November, not next year. Pre-sales orders will begin next week in many markets.

    I don't agree with Pete Cunningham, an analyst with UK research firm Canalys, who said he has begun to "doubt the Nokia comeback story." Just what timeline is he looking at?.

    Nobody who knows Nokia's situation can argue that any kind of turnaround is going to happen prior to the availability of the new Lumia line of phones. To say you doubt Nokia's comeback when the firm hasn't begun to sell its best products in the market is, I believe, an unjustified conclusion without merit.

    Pre-sales of the new Lumias in Europe have been strong, and in several markets, the Lumias are even more popular than the iPhone 5 (such as in France).

    I think everyone should just put down their shovels. You're digging your own grave, not Nokia's.

  • Report this Comment On October 18, 2012, at 6:31 PM, gslusher wrote:

    @smartbusiness and Krankor:

    The problem I have is that people like you have been saying the same things for over a year.

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