Mobile phone manufacturer Nokia has seen its profits plunge in the wake of falling demand for new handsets.
The Finnish company’s net profit in the first three months of 2009 was €122m – down from €1.2bn in the same period last year. Its net sales for the quarter were €9.3bn, down 27% year on year.
From the start of January to the end of March the company shipped 92m phones – a fall of 19% compared with the first quarter of 2008. Nokia said that equates to a 37% market share, 2% below what it had this time last year.
However, the company has not dropped its forecast of 10% less handset sales this year, reiterating instead that it expects to sell around 1bn devices in 2009. In fact, it said it was relatively pleased with its performance, pointing to things like its 5800 model, released to rival the Apple iPhone last November, which has sold 3m to date.
Olli-Pekka Kallsvuo, Nokia CEO, said: “In what has been an exceptionally tough environment, we continue to invest in a focused manner in consumer Internet services delivered across our broad portfolio of mobile devices. Combined, these solutions will drive our future growth.
“As an example in Q1, I am especially pleased with the performance of our first mass market touch product, the Nokia 5800 XpressMusic. Together with Comes With Music, it is a great example of Nokia providing solutions that consumers value.”
And while conceding that the market is poor, Kallsvuo said there was some optimism to be taken from more consistent patterns of demand emerging.
“Regarding the health of the overall mobile device market, the inventory already in the sales channels decreased substantially during Q1 due to extensive destocking by operators and distributors. This adversely impacted our sales volumes in the quarter. However, it has also resulted in the demand picture becoming more predictable as we enter the second quarter,” he said.
Nokia said its sales this quarter will be consistent with last, but could be “slightly more”.
Apple is due to report its figures on April 22.