Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) releases its third quarter earnings report today, and with the pending sale of its devices division, certain metrics will be more important than others. Analysts at JPMorgan Cazenove say they will be focusing on cash preservation and margins for Nokia Siemens Networks.

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Nokia’s results should be in line with guidance

Analysts Sandeep Deshpande and Rod Hall and their teams are expecting that Nokia’s results will be in line with the guidance provided by the company. They’re looking for third quarter group sales of €5.6 million, which is a 2% sequential decline and a 23% year over year decline. Their estimate is actually 5% lower than consensus, which is €5.9 million. They’re estimating lower Devices and Services and Nokia Siemens Networks sales, which is why their estimate is lower.

They expect to see earnings before interest and taxes of €123.4 million or 2.2%, compared to consensus of €161.4 million or 2.7%. For Devices and Services margins, they expect to see a loss of 2%, while they’re expecting NSN margins of 7.1%.

Nokia could post improvements in Lumia shipments

The JPMorgan Cazenove analysts say data points suggest Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) is gaining some momentum in sales of its Lumia line. Kantar World Panel data shows that Windows Phone share in Europe’s five largest markets ended August with an increase to 9.2% from 8.2% at the end of the previous month. They said there’s also anecdotal evidence suggesting that momentum for the Lumia is strong in other markets, particularly emerging markets like India.

The analysts expect to see better operational performance as a result and probable “a substantial deterioration” in cash burn for Nokia’s Devices and Services division.

Nokia Siemens Networks in line but affected by Japan

The analysts also expect Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) to report in-line results for NSN even though there are signs of weakness in Japan. When Ericsson reported third quarter results, it highlighted a slowdown in network spending in Japan. Since NSN is materially exposed to Japan, it could have seen weak sales, although some may have remained intact. They note that NSN did already see weaker sales in Japan during the last quarter, so it guided a significant 480 basis point sequential decline in third quarter margins. As a result, they expect that weakness in Japan was factored into Nokia’s guidance.

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