Nokia (ticker: NOK) reported 2Q05 earnings that missed analyst estimates today -- 22 U.S. cents vs. the 25-cent Thomson First Call analyst consensus estimate. The company also warned on pricing pressure that could limit any upside to increased handset volume sales in 3Q05. Excerpts from the NOK conference call:
On revenue growth – from lower priced, emerging markets:
…net sales reached €8.1b. This represents a year-on-year revenue growth of 25%, our highest sales growth in almost 5 years.
We shipped 60.8m mobile devices, representing a year-on-year volume growth of 34%. Sequentially, our mobile device volume grew by 13%. Almost all of this growth came from the Americas, with two-thirds of the growth coming from Latin America and the rest from North America.
The share of volume from the Americas climbed from 16% in the first quarter to 25% in the second quarter. This mix shift to the emerging markets, a lower price -- and lower price markets in general drove our ASPs down and also affected our margins negatively.
The market has really not taken off. It will be around the 50m or slightly lower, as I said earlier. It's all dependent on how the operators will be campaigning on the services and how the 3G devices will fit with their campaigning profile.
The discussion of the operators is ongoing, as we speak, and has been ongoing during the last 3 weeks. And we don't have a full picture on how strongly they will push the campaign button here.
(Quotes are from the CCBN StreetEvents transcript.)