By AGENCIES
THE woes at the Finnish mobile phone company Nokia continue to mount, with further losses in its main division in the second quarter of 2012, and a €220m (£170m) write-off on unsold stock of its smartphones.
But the ailing group's shares jumped by 10% to €1.50 as financial analysts said the losses were less grim than expected, and the firm had done better in the low-end "feature phone" market.
Nokia also admitted its high-profile attempt to break back into the US smartphone market with its new range of Lumia phones, running Microsoft's Windows Phone software, had led to only about 600,000 sales in the US – down on the 1.5m sold in the same period a year ago when the company was only offering its outdated Symbian software.
The mobile phone division recorded an operating loss of €474m, its second successive quarter of losses, on revenues down 26% year-on-year to €4.02bn. Overall, the company recorded a loss, including one-off restructuring costs, of €826m compared to a loss of €487m in the same period in 2011. Without the restructuring costs, losses would be €327m.
Stephen Elop, the chief executive appointed in September 2010 to try to pull Nokia out of its nosedive as rivals including Apple and Samsung began eating into the top-end smartphone market, said: "Nokia is taking action to manage through this transition period.
While this was a difficult quarter, Nokia employees are demonstrating their determination to strengthen our competitiveness, improve our operating model and carefully manage our financial resources." He added that Nokia was "executing with urgency" on restructuring which has seen the company plan to fire 10,000 staff in the coming year.
Elop amazed Nokia and the mobile phone business in January 2011 when he announced that Nokia would abandon the Symbian software, which he described as a "burning platform", and adopt Microsoft's new Windows Phone software for its smartphones. The first Lumia phone running that software appeared in October 2011.
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