Nokia (NYSE:NOK) reported dismal second-quarter results, showing declines in shipments, revenues and profits, but the company's outlook for the coming quarter was better than some analysts had forecast. Also, the world's largest handset vendor for the first time shipped fewer smartphones than upstart rival Apple (NASDAQ:AAPL)--a concrete indication of how far Nokia has fallen in a few short years.
Nokia reported a net loss in the quarter of $528 million. However, its results were boosted by $617 million in royalty payments in the quarter. During the second quarter, Nokia inked a patent-licensing agreement with Apple.
Nokia said it shipped a total of 88.5 million mobile phones in the quarter, a year-over-year decline of 20 percent. The company said it shipped 16.7 million "smart devices" in the quarter, a 34 percent decline from a year ago. Apple, during its most recent quarter, shipped a whopping 20.3 million iPhones.
"The challenges we are facing during our strategic transformation manifested in a greater than expected way" in the second quarter, acknowledged Nokia CEO Stephen Elop.
Summed ABI Research in a tweet: "Nokia in terrible shape both revenues and profits."
However, Elop pointed to a number of initiatives within Nokia to reverse its slide, including an acceleration of cost-cutting efforts he said will exceed operating expense reductions of $1.4 billion for the full year 2013.
Much of Nokia's planned turnaround hinges on its transition from Symbian to Microsoft's (NASDAQ:MSFT) Windows Phone as Nokia's primary smartphone platform. "In smart devices, those who already have viewed our early Windows Phone work are very optimistic about the devices Nokia will bring to market and about the long-term opportunities," Elop said in a statement. "Step by step, beginning this year, we plan to have a sequence of concentrated product launches in specific countries, systematically increasing the number of countries and launch partners."
Nokia has promised to release its first Windows Phone gadget sometime this year, and to continue to release new Windows Phone products throughout next year.
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