Americans Still Not Sold On Nokia Smartphones - InformationWeek

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1/24/2013
10:46 AM
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Americans Still Not Sold On Nokia Smartphones

Nokia posted its first profit in 18 months as sales of Lumia smartphones begin to take off, but North American market remains a challenge.

Nokia has reported its fourth-quarter and full-year earnings for 2012, and there are signs suggesting the beleaguered company may be emerging from the woods. Nokia recorded a profit of $585 million, its first in six consecutive quarters, on revenue of $10.73 billion. Nokia lost a staggering $1.27 billion during the third quarter on sales of $9.44 billion.

The company was also able to increase its cash reserves from $4.7 billion to $5.8 billion, which had slipped from a high of $7.2 billion in January 2012.

Device sales show promise, despite a year-over-year plunge from 113.5 million to 86.3 million. Sales of Nokia's Lumia Windows Phones jumped significantly, from 2.9 million in the third quarter to 4.4 million in the fourth quarter. The Nokia Lumia 920, its premiere smartphone, launched during the fourth quarter. Sales of its outgoing Symbian devices stood at 2.2 million.

[ Nokia is preparing the first Windows Phone to include a true PureView camera. Read about it here: Nokia Preps True PureView Windows Phone. ]

Total smartphone sales amounted to 6.6 million, up slightly from the third quarter's sales of 6.3 million, but down dramatically from the year-ago quarter's 19.6 million.

Nokia's numbers for North America paint a bleak picture: The company sold just 700,000 devices in Canada, Mexico, and the U.S. combined. That's up significantly from the 300,000 it sold in the same region during the third quarter, but it pales compared to sales of competing platforms.

For comparison, Verizon Wireless alone sold 6.2 million iPhones during the fourth quarter. Apple sold 47.8 million in total, more than ten times the number of Lumia smartphones sold by Nokia during the fourth quarter of 2012.

It's worth discussing Verizon's sales because Nokia Lumia smartphones were sold by Verizon for the first time in the fourth quarter. Verizon has not sold Nokia phones in volume for years, and it's never sold a Nokia smartphone. Variants of the 820 are also available from AT&T and T-Mobile.

Although Sprint does not yet offer Windows Phones, it will later this year. However, the carrier has selected devices from HTC and Samsung, not Nokia.

At the end of the day, the performance of Nokia's Lumia devices suggest the company could have reached a turning point -- perhaps things will get better going forward. Considering some of the reports about exciting devices we'll soon see from Nokia, 2013 could be the year Nokia once again stands firmly on its feet.

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