Nokia : Sales Up, Profits Down
Nokia seem to be on their way to their poorhouse after posting their Q2 reports, showing sales of a mere €13.2 billion, up 4% on last year. Net income is through the floor, down to €1.1 billion, less than half of the previous year.
This spiral into abject failure has been due to the closure of their factory in Bochum, a move which made them awfully unpopular with residents of the German town, for whom this source of work was integral. The 2,000 jobs were lost in an effort to make savings by shifting production to Romania, but Nokia still had to settle with a €300 million payoff for the German unions and workers, in addition to the €61 million in tax relief and grants that the government wants back. That is going to dent the profit margins of any company.
Nokia also shipped a trifling 122 million mobile phones, estimated as approximately 40% of the entire market share. With Apple aiming to gain one percent of the market by selling 10 million handsets in 2008, what some percieve as Nokia’s current ‘woes’ put all this iPhone hoopla into perspective… Apple has some ways to go before they reach the big leagues.
Source:Cellular News
Tags: Nokia
