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Investors happy with Nokia outlook

Investors happy with Nokia outlook
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Nokia has reported a second-quarter net loss of 368 million euros on declining sales of handsets, but the Finnish firm also said it expects its struggling mobile phone business to remain profitable in the third quarter.

That brought some relief to investors after Nokia lost its lead in the smartphone market to rival Apple. It’s also losing ground to phones using Google’s Android operating system.

Nokia reported a second-quarter underlying operating profit of 391 million euros, boosted by royalty revenues of 430 million euros, including payments from Apple following settlement of a legal dispute.

Nokia said it sold 16.7 million smartphones in the quarter, falling behind Apple’s sales of 20.3 million iPhones.

The company created the smartphone market in 1996 with its first Communicator model, but has failed in recent years to find an answer to the surge from Apple’s iPhone and Research In Motion’s BlackBerry.

Nokia’s Chief Executive Stephen Elop has been pinning turnaround hopes on new smartphones using Microsoft software, but these will only come to market later this year.

He said: “The challenges we are facing during our strategic transformation manifested in a greater than expected way in the second quarter.”