Accounts just filed by Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) Ireland see the once great telecom behemoth sliding further out of the limelight in 2012. Revenues fell 37% from €90 million to €56.2 million, leaving a pre-tax profit of just €447,000 in 2012. When you consider the firm made a pre-tax loss of €1.65 million in 2011, that might sound like good news, but the company has slashed administration costs from €7.2 million to €2.7 million and reduced the cost of selling from €84 million to €52.5 million. It’s hard to imagine where the company can make further savings.

Nokia

Losing the battle of the telecoms

The reality is, Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) is simply losing the race to keep up with the likes of Apple Inc. (NASDAQ:AAPL) and, more poignantly, Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930), which has been seen to be prying ever more market share away from Apple.

Meanwhile, in the battle of mobile platforms, Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s Symbian platform has failed spectacularly. While back in 2007, a Nokia handset was common in almost every Irish household, that device is now either an iPhone or an Android device. Over the past five years the size of the business has fallen by 79% in Ireland from 2008 when it enjoyed revenues of €270.8 million. 2011 saw revenues halved.

The end for Nokia Symbian

The directors’ report for the Irish unit stated that the business has declined significantly for the financial year as a result of competition in the market and consumers having less spending power:

“For the financial year 2012, the company’s net sales and profitability were negatively impacted by the increasing competing Smartphone platforms relative to Nokia Symbian Smartphones, as the group embarked on a platform transition to Windows Phone, as well as our pricing actions due to the competitive environment in both the Smartphone and mobile phone markets. As part of the transition, the company introduced new devices operating on the Windows ecosystem to the market during 2012. At the same time, sale of Symbian devices declined, which is consistent with the transition from one platform to another.

The directors say the company is set to remain in Ireland, but unless new innovations come online, it’s hard to see any halt to Nokia’s decline. ValueWalk was unable to get anyone at Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) to comment on any forthcoming launches or new products.

Can Microsoft do better?

Last year, Microsoft Corporation (NASDAQ:MSFT) agreed to buy Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s mobile phone business, which had a market capitalization of €110 billion in 2007 for €5.4 billion. 32,000 Nokia employees will transfer to Microsoft early this year as part of the deal.

In contrast to Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s Symbian system, Microsoft Corporation (NASDAQ:MSFT)’s Windows platform for mobile devices is in the ascendency. Compatibility with other Microsoft business products has seen the platform rise in popularity with the corporate market as an alternative to iOS and Android. Even Sony Corporation (NYSE:SNE) (TYO:6758) is considering launching a Windows phone – clearly, seeing a big opportunity in the corporate sector.

But where to next for Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)? Former chief executive, Stephen Elop, fled to Microsoft Corporation (NASDAQ:MSFT) in 2011, declaring that Nokia’s own mobile platform was ‘burning’ and, ironically, could end up being the new boss at his old firm.

Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) still has cash for a fresh start, but it needs more than that. It needs ideas. Risto Siilasmaa, chairman and acting chief executive, has spoken of a new Nokia in a world packed with connected devices. However, Nokia won’t be making any of those devices and, although Nokia isn’t revealing any plans for the future just yet, he hinted that the firm might return to manufacturing consumer goods.