Nokia reported a third-quarter loss that widened to 969 million euros ($1.27 billion). Nokia’s loss compared with a loss of 68 million euros in the third quarter a year earlier. Revenue fell 19% to 7.2 billion euros.
Much of the loss was blamed on sharply declining sales of its smartphones. The company sold 2.9 million Lumia smartphones in the quarter, falling from four million during the second quarter. This was the first quarterly decline since the line was introduced.
It seems as if customers are waiting for the introduction of new handsets running a newer version of the Windows operating system before they make their purchases. The existing Lumia handsets run on Windows 7.5 software. The phones cannot be upgraded to Windows 8.
Nokia’s chief executive, Stephen Elop, said, “It was not a surprise that the Lumia results in the third quarter demonstrated that people were delaying new purchases.” Company officials said that Lumia handsets that run Microsoft’s Windows Phone 8 software would start selling this year.
Analysts had hoped that Nokia would be able to reverse its decline with Lumia, its line of Windows smartphones, but their confidence has been shaken by the latest loss. Pete Cunningham, an analyst at Canalys research firm, said, “This is probably the first time that I have started to doubt the Nokia comeback story. These numbers were poor and worse than I expected.”
Nokia plans to expand its lineup of Lumia smartphones over the next year to cover the complete range of buyers. The larger lineup will give retailers an alternative to Apple’s iPhone and Google’s Android phones. Mr. Elop declined to say how many new Lumia handsets would be introduced.
Mr. Elop said, “Next year is going to be a very interesting year. A number of operators around the world are increasingly frustrated with the two strong ecosystems in their shops today. As they see a full portfolio of products with Lumia from Nokia, this will represent for them a credible third alternative.”