Nokia has just posted their Q4 2011 financial results and the numbers aren’t exactly what one would call pretty. Regarding sales of the Nokia Lumia lineup, they topped 1 million units, but that number is deceptive since it includes devices sold after the end of the quarter. In other words, 1 million Lumias were moved between the launch in mid November to today. As for smartphone sales in general, they hit 19.6 million units, down 31% compared to the same quarter a year ago, but up 17% from Q3 2011. Feature phones did marginally better, 93.9 million units sold, down just a single percentage point compared to the same quarter last year, and up 5% compared to Q3 2011. The average price of a smartphone Nokia sold in Q4 2011 was 140 Euros, which is up 7% from the quarter prior, but down 9% from the same quarter a year ago. The average price of a feature phone during Q4 2011: 32 Euros, the same as it was in Q3 2011, but down 25% compared to a year ago.
How has the company done overall? They achieved over 10 billion Euros in sales, 21% lower than the same quarter a year ago, but whereas last year they made 884 million Euros in profit, this year they’re 954 million Euros in the red. Yes, you read that right, Nokia lost almost 1 billion Euros in Q4 2011. Key quote from Stephen Elop, the CEO of Nokia:
“And, while we progressed in the right direction in 2011, we still have a tremendous amount to accomplish in 2012, and thus, it is my assessment that we are in the heart of our transition.
Specifically, changing market conditions are putting increased pressure on Symbian. In certain markets, there has been an acceleration of the anticipated trend towards lower-priced smartphones with specifications that are different from Symbian’s traditional strengths. As a result of the changing market conditions, combined with our increased focus on Lumia, we now believe that we will sell fewer Symbian devices than we previously anticipated.”
There’s a call scheduled to take place at 15:00 Helsinki time that we’re going to attend. If any new information pops up, we’ll add it to the bottom of this article.
Update: Breaking things down by territory, Nokia sold 24% fewer devices in Europe in Q4 2011 than they did during the same quarter last year. That number climbs up to 33% for China. Latin American device shipments are up 2%, Asia/Pacific shipments are up 11%, and Middle East + Africa shipments are up 17%, again all compared to Q4 2010.
Update: Another key quote:
Our broad strategic agreement with Microsoft includes platform support payments from Microsoft to us as well as software royalty payments from us to Microsoft. In the fourth quarter 2011, we received the first quarterly platform support payment of USD 250 million (EUR 180 million).
Over the life of the agreement, both the platform support payments and the minimum software royalty commitments are expected to measure in the billions of US Dollars.
Update: And one more:
Following the announcement of our strategic partnership with Microsoft in February 2011, our strategy included the expectation to sell approximately 150 million more Symbian devices in the years to come. However, changing market conditions are putting increased pressure on Symbian. In certain markets, there has been an acceleration of the anticipated trend towards lower-priced smartphones with specifications that are different from Symbian’s traditional strengths, which has contributed to a faster decline of our Symbian volumes than we anticipated. We expect this trend to continue in 2012. To maximize the value of the Symbian asset going forward, we expect to continue shipping Symbian devices in specific regions and distribution channels, as well as to continue to provide software support to our Symbian customers through 2016. As a result of the changing market conditions, combined with our increased focus on Lumia, we now believe we will sell fewer Symbian devices than previously anticipated. Thus, in the fourth quarter 2011, we recognized allowances for excess component inventory and future purchase commitments related to Symbian.