Nokia +7.6% premarket; NSN's margin, guidance impress


Investors seem pleased NSN (NOK) had a non-IFRS op. margin of 8.4% in Q3; that's down from Q2's 11.8% and the year-ago period's 9.3%, but above the midpoint of a guidance range of 7% (+/- 4%).

Moreover, Nokia is guiding for a 12% NSN op. margin (+/- 4%) in seasonally strong Q4, and for the division to see "solid" Q/Q sales growth.

NSN's sales, pressured by seasonality, order lumpiness, and business/contract divestments, fell 7% Q/Q and 26% Y/Y to €2.6B, after dropping 17% in Q2. Mobile infrastructure sales -26%, services -23%. Op. profit totaled €218M vs. €328M in Q2 and €324M a year ago. Rival Ericsson saw only a 3% Y/Y sales drop in Q3.

The HERE division (location services) saw its sales drop 20% Y/Y to €211M, after declining 18% in Q2. Op. profit was €20M, down from €37M a year ago.

Devices & Services, soon to be in Microsoft's hands, saw a 19% Y/Y sales drop (better than Q2's -32%), an op. loss of -€47M, and an op. margin of -1.6%. 8.8M Lumias were sold, up from 7.4M in Q2 and 5.6M in Q1. Feature phone units +4% Q/Q and -27% Y/Y to 55.8M.

Ahead of the Microsoft deal's closing, gross cash totaled €9.1B at quarter's end, and net cash €2.4B. NSN's contributions to those figures were €2.7B and €1.5B.

Q3 results, PR

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Comments (16)
  • joeinslw@gmail.com
    , contributor
    Comments (1071) | Send Message
     
    What nobody has anything bad to say about NOK today???
    29 Oct 2013, 09:31 AM Reply Like
  • KevinRemde
    , contributor
    Comments (572) | Send Message
     
    What's not to love?
    29 Oct 2013, 09:39 AM Reply Like
  • joshvegas
    , contributor
    Comments (524) | Send Message
     
    With improved margins in Q4 what could EPS look like? Any guess?
    29 Oct 2013, 09:39 AM Reply Like
  • Skylander2011
    , contributor
    Comments (454) | Send Message
     
    i wonder if msft will offer more money now
    29 Oct 2013, 10:01 AM Reply Like
  • wigit5
    , contributor
    Comments (4365) | Send Message
     
    not likely the ink on the deal is all but dry... it would be pretty unprofessional for $NOK to come back and say wait we need more $$ as they new how sales were tracking when they first agreed to the deal.

     

    If the lumia sales were unexpectedly higher by a large margin then there could be some discussion
    29 Oct 2013, 10:34 AM Reply Like
  • san111
    , contributor
    Comments (11) | Send Message
     
    the CFO already mentioned on call that they expect the price of the sale to be more or less the same after taking into consideration the Q3 D&S performance and any other information about Q4 they might have. So the price is fixed and deal is all but done. Any further upside has to come from the new Nokia and its three businesses - NSN, HERE and the patents/CTO org.
    29 Oct 2013, 01:23 PM Reply Like
  • vk007
    , contributor
    Comments (82) | Send Message
     
    From where is the growth going to come from?
    29 Oct 2013, 10:07 AM Reply Like
  • Aasmul
    , contributor
    Comments (72) | Send Message
     
    Alcatel lucent :-)
    29 Oct 2013, 10:34 AM Reply Like
  • vk007
    , contributor
    Comments (82) | Send Message
     
    That could be a French kiss of death...
    29 Oct 2013, 10:48 AM Reply Like
  • Aasmul
    , contributor
    Comments (72) | Send Message
     
    Perhaps but they need to replace the lost revenue somehow and they are clearly unable to do that organically which just leaves M&A.
    After a couple more years like this one, NSN would have a margin of 50% but practically no sales.
    29 Oct 2013, 12:30 PM Reply Like
  • mKiwi
    , contributor
    Comments (1845) | Send Message
     
    JC Penney

     

    Revenue 17.2 billion

     

    Nothing wrong with good old fashion retail

     

    Market cap 2.2 bil
    29 Oct 2013, 06:43 PM Reply Like
  • Mking30
    , contributor
    Comments (142) | Send Message
     
    It could be a rough beginning to something spectacular.......LONGER than Long... It's becoming a Darling.................. on up sleethering like a snake ............
    29 Oct 2013, 11:24 AM Reply Like
  • Ewlik
    , contributor
    Comments (105) | Send Message
     
    Someone know why share prices grew 10% after Q3 results? As I see Nokia reported negative sales trends in all 3 segments. Even % of margins fell as well.
    29 Oct 2013, 06:11 PM Reply Like
  • Seppo Sahrakorpi
    , contributor
    Comments (2146) | Send Message
     
    Good summary here:
    http://seekingalpha.co...
    29 Oct 2013, 07:28 PM Reply Like
  • JoseV
    , contributor
    Comments (401) | Send Message
     
    As Crinching Numbers says "expectations, expectations"
    29 Oct 2013, 11:31 PM Reply Like
  • JoseV
    , contributor
    Comments (401) | Send Message
     
    CN, sorry, Crunching Numbers
    29 Oct 2013, 11:32 PM Reply Like
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