Nokia’s smartphones fail to take off during holiday season

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Nokia today announced its Q4, 2013 results without revealing the number of mobile phones and smartphones it shipped during the quarter. The company had earlier announced it will change the way it reports its results by putting all assets that Microsoft is acquiring under discontinued operations. Despite not releasing the numbers, Nokia admitted that net sales of its devices business were lower than the previous quarter, which should be worrying for Microsoft considering everyone expected an increase owing to it being the holiday quarter.

“On a sequential basis, discontinued operations unit volumes increased in the fourth quarter 2013 due to higher Mobile Phones unit volumes, partially offset by lower Smart Devices unit volumes,” Nokia said in its earnings statement. Adding, “Discontinued operations ASP declined on both a year-on-year and sequential basis in the fourth quarter 2013. The year-on-year and sequential declines in discontinued operations ASP were due to both Smart Devices and Mobile Phones.”

Nokia is facing intense competition even in the entry-level smartphone market from Android players and the Finnish giant has had to cut prices across its Lumia portfolio to remain somewhat competitive.

“The sequential decline in discontinued operations net sales in the fourth quarter 2013 was primarily due to lower Smart Devices net sales. Our Smart Devices net sales were affected by competitive industry dynamics including the strong momentum of competing smartphone platforms. On a sequential basis, Mobile Phones net sales were approximately flat,” Nokia reported.

Nokia also mentioned that it expected the acquisition to complete in the current quarter. It remains to be seen how Microsoft can turn around the handset business.