Rajeev Suri, Nokia Siemens’ CEO, noted in an interview on Wednesday that the company still had some serious challenges ahead. “The market is very tough; we’ve seen a number of capex cuts in the first half of the year,” he noted. Suri spoke after the inauguration of a production line in Brazil.
Suri’s standpoint exclaims the general market outlook on Nokia Corporation (NYSE:NOK). Goldman Sachs recently maintained that Nokia Corporation (NYSE:NOK) is stock is still a sell, representing a common trend among various analytical firms.
Alongside other remarks, Suri noted that the market was not only crowded, but also submerged in cut throat competition. Despite the general disappointing performance of Nokia Corporation (NYSE:NOK), its joint venture with Germany’s Siemens, Nokia Siemens, reported good third quarter results. Nokia Siemens’ impressive results come amid the implementation of a huge restructuring strategy that kicked off towards the fall of 2011. Suri noted that the good results were traceable to the strategy and not the market. “We’re delivering because of our strategy. The market is not helping a lot,” he remarked.
Nokia Siemens moved closer to realizing a turnaround, after reversing its earnings from a loss of €114 million (around $148 million) last year, to make operating profits of €182 million (around $238.8 million) in the past quarter.
Nokia Siemens has been particularly keen on LTE, a new advancement in mobile technology that promises faster speeds, when compared with fixed-line connections. As of the moment, the company has managed to ink 67 LTE contracts. The new production line in Brazil will accommodate 2 LTE contracts.
Suri maintains that Nokia Siemens placed most of its emphasis in Japan and the U.S. The company also directed most of its efforts towards improving its Korean operations. “I maintain that these three countries are the most advanced in terms of uptake of new technology right now. Our strength in Japan, Korea, and the U.S. is helping a lot,” he remarked.
Despite the positive progress made with earnings, the company still has a lot of work ahead of it. It still has to keep its promise of slashing its workforce by 17,000. Similarly, it has to tighten up on costs, following yet another promise to reduce costs by €1 billion (around $1.2 billion) by the end of next year.
As a signal of positive progress, the firm has already reduced its workforce by 14,300. Suri notes that this progress, coupled with future efforts, thickens long term prospects for the company’s shareholders.