Nokia lowers Devices & Services first quarter 2012 outlook and provides second quarter 2012 outlook - Seite 2
Additional commentary on the first quarter 2012 for Devices & Services and
Nokia:
Nokia currently estimates that Devices & Services net sales in the first quarter
2012 were EUR 4.2 billion, comprised of Mobile Phones net sales of EUR 2.3
billion (71 million units), Smart Devices net sales of EUR 1.7 billion (12
million units), and Devices & Services Other net sales of EUR 0.2 billion. Based
on the preliminary view, Nokia ended the first quarter 2012 around the high end
of our normal 4 to 6 week channel inventory range, but on an absolute unit
basis, channel inventories declined sequentially.
Nokia currently estimates that Devices & Services gross margin (including
Devices & Services Other) for the first quarter 2012 was approximately 25%, with
Mobile Phones gross margin of approximately 26% and Smart Devices gross margin
of approximately 16%.
In the first quarter 2012, Nokia sold more than 2 million Lumia devices at an
average selling price of approximately EUR 220 (reported within the Smart
Devices business unit). Furthermore, Nokia has seen sequential growth in Lumia
device activations every month since starting sales of Lumia devices in November
2011. Lumia has gained market share with both distribution partners and
consumers. The Windows Phone ecosystem is also attracting developers and has
expanded rapidly with more than 80,000 applications available.
Nokia currently estimates that at the end of the first quarter 2012, the
company´s gross cash and other liquid assets were approximately EUR 9.8 billion,
and Nokia´s net cash and other liquid assets were approximately EUR 4.9 billion.
The sequential decline in net cash and other liquid assets was driven by Devices
& Services, which experienced unfavorable and mostly non-recurring net working
capital changes as well as operating losses. Nokia Siemens Networks contributed
positively to Nokia´s cash flow in the first quarter 2012 due to net working
capital improvements. This was despite Nokia Siemens Networks having a
preliminarily estimated non-IFRS operating margin of approximately negative 5
percent in the first quarter 2012, in line with the previously provided outlook.
Actions to Address Competitive Industry Dynamics Affecting Devices & Services
Nokia is quickly taking action. Nokia will continue to increase its focus on
accelerating Lumia sales, as well as on lowering the company´s cost structure,
improving cash flow and maintaining a strong financial position.
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- In the Smart Devices business unit, Nokia is increasing investments in Lumia
to bring more products to more consumers in more markets.
- In the Mobile Phones business unit, Nokia is taking tactical pricing actions