Nokia reports troubled results for Q1 2012, with "mixed" sales for its first Windows Phone-powered devices adding to dwindling profits and cash reserves.
First, the numbers. Total Q1 2012 Nokia sales are down by -29% Y-o-Y (reaching €7.4 billion) while total net cash (cash less debt) are down by -24% Y-o-Y, amounting to €4.9bn. Total 2011 spendings for Nokia total €1.5bn, while Q1 2012 spending is already up to €700 million.
Back in 2011, Nokia CEO Stephen Elop compared Nokia's situation as being on "a burning oil platform"-- with jumping into the ocean as the only option for survival. He was, of course, referring to Nokia's jumping on the Windows Phone platform.
Did Nokia miss the lifeboat and land in dangerous waters instead?
According to Business Insider SAI Nokia might have done exactly that... SAI predicts "at the first quarter's burn rate, Nokia would blow through its net cash in 7 quarters (less than 2 years) and its total cash in 4 years."
Elop knows that, and is urging to company to start conserving cash-- even if it still needs to spend money to make money.
Nokia is also losing its bread and butter, the lower-end market. Judging from the earnings report, Nokia doesn't have much of a feature phone plan (other than "renewing" the series 40 platform), and risks losing the market to the Android-powered competion like Samsung, Huawei and ZTE.
Was moving to Windows Phone a step in the wrong direction for the once mighty Nokia, then? Only time will tell-- until then, Nokia will continue slashing costs and pushing Lumia devices, in hopes of boosting its chances for survival.
Go Nokia Q1 2012 Interim Report
Go And Now Nokia Has a New Problem-- It Might Go Bankrupt (Business Insider SAI)
