Nokia’s flagging sales are clinging to the Lumia line

July 19, 2012

Nokia announced that it has sold 4 million Lumia phones, meeting analyst expectations. But that’s about all that the company could boast about in its earnings report on Thursday. Overall, the Finnish smartphone giant posted more than $1 billion in losses and said sales were down five percent in the last three months.

It will be interesting to see if the company can continue to sell its phones as its partnership with Microsoft matures. While the Nokia 900 won’t be supporting the next generation of Windows Phone software, Nokia has made it clear that it’s releasing new, lower-priced phones that will run on Windows 8. The company is looking to compete with Asian device makers, such as Huawei and ZTE, according to a report from the Wall Street Journal.

The Lumia line part of a renewed push from Nokia — until recently the world’s largest cellphone maker — to put out more innovative products. The Journal’s report focused on how Nokia missed the smartphone revolution and revealed that the company had working prototypes of iPhone-type devices as far back as the late 1990s but never brought them to market. Not only that, the company has spent about $40 billion on research and development in the past decade, the report said, about four times what Apple has spent in the same period.

But you’d never know it as an American consumer. While Nokia phones were practically ubiquitous not that long ago (who doesn’t know the Nokia ringtone?), the company has until recently sat out the smartphone revolution. It’s smartphone platform, Symbian, was spiked in early 2011 in favor of the Windows Phone partnership, and a second system, MeeGo, has also fallen by the wayside.

Chief Executive Stephen Elop has been making tough choices in the past year in an effort to make Nokia a slimmer, more focused company, including a decision to cut 10,000 jobs by the end of 2013.

“Nokia is taking action to manage through this transition period,” said Elop in a statement Friday. “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.”

Related stories:

Nokia drops the price of the Lumia 900

Samsung, Apple top Nokia in smartphone shipments

Nokia files patent suits against HTC, RIM and ViewSonic

Hayley Tsukayama covers consumer technology for The Washington Post.
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