NSN, which highlighted its recent mobile infrastructure successes today, reported revenues of €2.94 billion (US4.1 billion), 7 percent better than a year earlier, though down 3 percent from the second quarter. (See LightSquared Names LTE Suppliers, Telecom Italia, NSN Trial LTE in Turin, NSN Lands $7B LTE Deal in US , Euronews: Oct. 5, No Sign of Recovery for Nokia Siemens, and NSN's 2010 Confidence Slips.)
Table 1: Nokia Siemens Networks Q3 2010
|In millions of euros||Q3 2009||Q3 2010||Y/Y change||Q2 2010||Q/Q change|
|Reported operating profit||-1,107||-282||+74.50%||-179||-57%|
|Adjusted operating profit*||-53||-116||-119%||+51||-327%|
|* Excluding one-time costs and special items|
However, the third quarter is seasonally weak, and the sequential dip in revenues was not as steep as usual -- a year ago, third-quarter sales fell by 14 percent quarter-on-quarter.
NSN noted that better supply-chain conditions, and the end of the network purchase order deadlock in India (which hit its second-quarter numbers), helped its revenues. (See India Holdups Smack NSN's Q2.)
"Sales in the third quarter 2010 benefited from some improvement in overall component availability, as well as an improvement in the industry-wide issue related to security clearances in India which was preventing the completion of product sales to customers," it stated in Nokia's earnings press release.
The improvement in trading conditions in India, plus strong performance in Japan, led to a solid quarter in Asia/Pacific, where revenues were up sequentially and year-on-year.
Table 2: Nokia Siemens Networks Q3 2010 Revenues By Region
|In millions of euros||Q3 2009||Q3 2010||YoY change||Q2 2010||QoQ change|
|Middle East & Africa||387||331||-14%||400||-17%|
As usual, the company's Global Services division was the bedrock of the vendor's sales, contributing €1.4 billion ($1.95 billion), nearly 48 percent, of NSN's quarter's total revenues.
Nokia's CFO Timo Ihamuotila noted that "we continue to hear strong and positive feedback from customers" about NSN, which is on course to cut its annual operating costs by €500 million ($696 million) by the end of 2011, compared with the end of 2009.
However, the company is still struggling to break even, reporting an operating loss of €282 million ($392 million).
Looking ahead, NSN expects its fourth-quarter revenues to be between €3.4 billion and €3.8 billion ($4.7 billion and $5.3 billion), which is in line with 2009's fourth-quarter revenues of €3.63 billion ($5.01 billion). The vendor still expects to maintain its market share in "a flat market in Euro terms for the mobile and fixed infrastructure and related services market in 2010, compared to 2009."
NSN expects its acquisition of Motorola Inc. (NYSE: MOT)'s wireless infrastructure business to close before the end of the year, a move that will boost its scale, portfolio, and presence in certain markets (especially North America) in 2011. (See Chief Supply Chain Officer Study - by IBM, NSN Expands in North America With Moto Buyout, and NSN to Buy Moto's Wireless Biz for $1.2B .)
— Ray Le Maistre, International Managing Editor, Light Reading