Despite cutting jobs and closing factories, the struggling cell phone maker Nokia (News - Alert) continues to lose money. The latest financial results for the second quarter of 2012, posted by Nokia, indicate that the struggle is not yet over for the Espoo, Finland based mobile handset maker. The company reported $1 billion operating loss on $9.21 billion in net sales.
However, the analysts think it is a positive sign for the company, whose stock rose for the first time in years after the financial results were announced for the second quarter. Meanwhile, the company is reporting improvement in the sales of Lumia phones.
According to the Insider, as per analysts’ expectations, Nokia sold some four million Windows Phone (News - Alert)-powered Lumia phones in Q2. The sale of Lumia phones has doubled from the first quarter, wrote Insider reporter Robin Wauters. However, the U.S. performance continues to be disappointing for the company. As per this report, Nokia sold only 600,000 phones in the U.S.
The report indicates that the average selling price of Nokia’s Lumia phones in the second quarter was $229, compared to $270.8 in Q1 2012.
Overall, Wauters wrote that Nokia sold only 10.2 million smartphones, down 14 percent compared to the previous year. However, unlike smartphones, features phones were on the rise. Consequently, the report shows that Q2 volumes for feature phones increased by four percent quarter-on-quarter and year-on-year to reach 73 million units, Nokia said. However, the Insider report shows that the company generated a gross cash of $11.6 billion and net cash of $5.2 billion.
Wauters wrote that CEO Stephen Elop is betting on the Lumia running Microsoft (News - Alert) Windows Phone. But, some media reports are suggesting that partner Microsoft is thinking of developing its own Windows Phone. But, Nokia’s Elop does not believe in that rumor, wrote Wauters.
Commenting on the Q2 results, Elop said, “Nokia is taking action to manage through this transition period. While Q2 was a difficult quarter, Nokia employees are demonstrating their determination to strengthen our competitiveness, improve our operating model and carefully manage our financial resources.”
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Edited by Rachel Ramsey