by Yahoo! News
Mobile phone maker Nokia Corp. on Thursday posted a loss of euro368 million ($523 million) as sales slumped in the second quarter amid "greater than expected" challenges.
The result was down from a profit of euro227 million in the same period last year.
Nokia said its revenue fell 7 percent to euro9.3 billion from euro10.0 billion the previous year. It shipped 88.5 million mobile devices in April through June, down from 111 million a year ago and 108.5 million in the previous quarter.
"The challenges we are facing during our strategic transformation manifested in a greater than expected way" during the quarter, CEO Stephen Elop said. "However, even within the quarter, I believe our actions to mitigate the impact of these challenges have started to have a positive impact on the underlying health of our business."
Nokia's share was up 4.6 percent at euro4.26 on the Helsinki Stock Exchange immediately after the report.
Nokia said it was accelerating its cost-cutting plan to exceed the previously targeted savings of euro1 billion in 2013. The reductions would be achieved through cuts in staff and oustourced professionals, facility costs "and various improvements in efficiencies," the company said.
Nokia rose to the top position in the cell phone business in the late 1990s when it overtook Motorola. Although it struggled in the U.S., it dominated almost everywhere else, primarily through mass sales of low- and mid-priced mobile phones.
Now, Nokia is being squeezed in the low end market by Asian manufacturers like ZTE and in the high end by the makers of smartphones like the iPhone and Blackberry devices. Its global market share dropped below 30 percent earlier this year for the first time in more than a decade.
Nokia's share price has dropped nearly 50 percent this year, falling below euro4 this month.
The Espoo, Finland-based company hopes to regain momentum through a linkup with Microsoft, whose Windows Phone operating system will replace Nokia's Symbian software. Symbian has been losing ground to Google's popular Android platform. Nokia expects to launch its first Windows phones later this year.
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