Nokia sales plummet by 20 per cent

Nokia today reported less than rosy results for its third quarter, with company-wide operating profit shrinking by more than half.

Overall net sales for the period ending September totaled 9.8 billion, a 20 per cent drop compared to last year's figures. Meanwhile, net sales for its device and services business were also down by a fifth.

Nokia claimed its market share remained fairly constant at 38 per cent for the quarter, in line with its share in 2008 and in the second quarter of 2009. That said, the company shipped more than 108 million units during the three-month period, which is a five per cent increase on Q2 but an eight per cent drop year-on-year.

"The demand for mobile devices improved in many markets during Q3. With the average selling price of our devices holding firm quarter-on-quarter, our higher device volumes translated into increased net sales in our Devices & Services business," Nokia's chief executive Olli-Pekka Kallasvuo said in a statement.

"Our volumes and net sales were, however, somewhat constrained by component shortages we encountered across the portfolio," he added. "I also want to highlight the good operating expense management that helped the segment deliver solid earnings,"

During the quarter, Nokia also wrote off 908 million in an "impairment of goodwill" for Nokia Siemens Networks.

"The challenging competitive factors and market conditions in the infrastructure and related services business necessitated non-cash impairment charges at Nokia Siemens Networks," he said. "We continue to support Nokia Siemens Networks actions to improve its performance."

Nokia remained optimistic about the next quarter, suggesting it expects industry wide mobile shipments to be up during the fourth quarter. Its own mobile device volumes are likely to remain on a par with third quarter performance, Nokia said.