Nokia First Quarter Earnings Drop 90 Percent

Nokia has released its financial results for the first quarter of 2009...and the world's largest handset maker saw its earnings drop 90 percent compared to a year ago.

Not many companies have been immune to the global economic downturn…and Finland’s Nokia certainly hasn’t been one of them. The company has posted its financial results for the first fiscal quarter of 2009: its earnings were down a whopping 90 percent compared to the same quarter a year ago. Nokia still managed to eke out a profit of €0.03 per share, but that’s down from €0.32 a year ago. Overall sales dropped from €12.6 billion a year ago to €9.6 billion last quarter.

Nokia CEO Olli-Pekka Kallasvuo noted the world economic climate is “exceptionally tough,” which has reduced worldwide for mobile phones. “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,” said Kallasvuo, in a statement. “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.”

Overall, Nokia sees the second quarter of 2009 as being flat or slightly up compared to the first quarter, but overall the company expects sales to be down at least 10 percent for 2009 compared to 2008, with the majority of the drop happening in the first half of the year.