Nokia announces a €1.4 billion loss in 2011
Nokia Corporation, a Finnish multinational communications corporation announced a loss of €1.4bn loss for 2011 in its annual report to the US Securities and Exchange Commission (SEC).
Stephen Elop, CEO of Nokia attempts to embrace Microsoft’s Windows Phone operating system for its smartphone range has failed to put the company back in track. According to the inquirer, the decision to go over the Windows Phone operating system only managed to materialize sales of €38.7bn, almost €4bn down from a year previously. The inquirer stated, “After taking into account the cost of flogging its phones, research and development, administration and marketing expenses, close to a €1.1bn impairment to goodwill and tax all Nokia had left was a €1.4bn loss, hardly inspiring for the firm.”
Nokia still has €9.2bn in cash and short-term assets, demonstrating an increase of almost €2bn from 2010. Nokia is not desperate but according to analysts, the graphs are not pointing to the right direction. Nokia’s latest Windows Phones-based smartphones did not set the world on fire and failed to put the sales figures back inline as the firm used to enjoy years ago.
In 2011, Nokia announced plans to cut on its research and development efforts, but its SEC filing showed that it spent the best part of €6bn on this key area of its business. The inquirer stated, “Elop might be faulted for trying to cut down expenditure in this area but as a businessman you can’t argue against his decision, given that in three years and almost €18bn of research and development the most consumer facing result of this division is a ‘pixel binning’ algorithm to produce a 38 megapixel camera phone running on a dead operating system.”
Nokia should embark into improving the firm’s management and the €1.4bn loss of 2011 should be a strong reminder of that. Surely, working out the oversights in a large firm such as Nokia could take a long time and a few more eye watering SEC filings.
| Via: The Inquirer | Source: 1 | Image credit: 1 |
Nokia announces a €1.4 billion loss in 2011
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