Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) disappointed investors with its first quarter earnings report early this morning, and shares fell as much as 12 percent at the New York Stock Exchange in pre-market trading. The report shows that while Windows 8 phones are gaining momentum, the company’s drop in feature phones was larger than its increase in Windows 8 phones.
The struggling Finnish handset maker reported a decline of 20 percent in net sales for the first quarter. Sales dropped to €5.85 billion ($7.63 billion). The company posted losses of €.07 per share, compared to a loss of €.25 per share during the same quarter a year ago. Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) reported an adjusted loss of €.02. A consensus of analysts polled by FactSet indicated expectations of losses of €.05 per share on €6.55 billion in revenue.
Nokia Corporation (NYSE:NOK) posted a 27 percent quarter-on-quarter increase to 5.6 million in Lumia volumes, although the company’s mobile phones volumes fell 30 percent quarter-on-quarter to 55.8 million.
“We have areas where we are making progress and areas where we are further increasing the focus,” said Nokia CEO Stephen Elop in a statement. “For example, people are responding positively to the Lumia portfolio, and our volumes are increasing quarter over quarter.”
Another problem for Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) is the drop in sales at its Nokia Siemens Networks, a joint venture which previously had been doing extremely well.
The company also said it expects operating margins to deteriorate, which hurt its stock even more. It guided for devices and services margins to be around negative 2 percent during the second quarter, a significant drop from a positive .1 percent during the first quarter.