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© Nokia Electronics Production | July 21, 2011

Nokia reports 2Q operating loss of EUR 487 million

"The challenges we are facing during our strategic transformation manifested in a greater than expected way in Q2 2011. However, even within the quarter, we believe our actions to mitigate the impact of these challenges have started to have a positive impact on the underlying health of our business."

- Net sales of EUR 9 275 million (EUR 10 003 million in Q2 2010) - Reported operating loss of EUR 487 million (operating profit of EUR 295 million) - Reported EPS (diluted) of EUR -0.10 (EUR 0.06) © Nokia Nokia outlook (July 21, 2011) Nokia targets Nokia Group net cash and other liquid assets at the end of 2011 to be above the EUR 3.9 billion balance at the end of the second quarter 2011. Due to limited visibility, Nokia is providing a wider than normal range for its Devices & Services non-IFRS operating margin outlook for the third quarter 2011. Nokia expects its non-IFRS Devices & Services operating margin in the third quarter 2011 to be slightly above breakeven, ranging either above or below this level by approximately 2 percentage points. This outlook is based on our expectations regarding a number of factors, including: - Competitive industry dynamics; - Nokia’s actions to intensify its focus on retail sales marketing to drive net sales; - Improved competitiveness in our Mobile Phones unit due to the ramp up of Dual SIM devices; - Timing of our new product shipments; and - The macroeconomic environment Nokia is accelerating its plans to reduce its Devices & Services non-IFRS operating expenses and Nokia now targets to exceed its previous Devices & Services non-IFRS operating expense reduction target of EUR 1 billion for the full year 2013, compared to the full year 2010 Devices & Services non-IFRS operating expenses of EUR 5.65 billion. Nokia and Nokia Siemens Networks expect Nokia Siemens Networks net sales to be between EUR 3.2 billion and EUR 3.5 billion in the third quarter 2011. Nokia and Nokia Siemens Networks expect the non-IFRS operating margin in Nokia Siemens Networks to be between -3% and breakeven in the third quarter 2011. Nokia and Nokia Siemens Networks continue to target Nokia Siemens Networks net sales to grow faster than the market in 2011. Nokia and Nokia Siemens Networks continue to target Nokia Siemens Networks non-IFRS operating margin to be above breakeven in 2011. Nokia and Nokia Siemens Networks continue to target Nokia Siemens Networks to reduce its non-IFRS annualized operating expenses and production overheads by EUR 500 million by the end of 2011, compared to the end of 2009. The outlook relating to Nokia Siemens Networks includes the impact of the acquisition of Motorola Solutions’ networks assets. This is an update to the previous outlook that did not include the impact of the acquisition of Motorola Solutions’ networks assets.
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