Jul 22, 2011

Stephen Elop On Q2 2011 Nokia Net Sales Report

More optimistic than ever, Stephen Elop, Nokia CEO addresses the crowd as he visualized the future of the worlds biggest mobilephone manufacturer at the recent Nokia event.

"The challenges we are facing during our strategic transformation manifested in a greater than expected way in Q2 2011. However, even within the quarter, I believe our actions to mitigate the impact of these challenges have started to have a positive impact on the underlying health of our business. Most importantly, we are making better-than-expected progress toward our strategic goals."

In Q2, our immediate action to manage unexpected sales and inventory patterns enabled us to create healthier sales channel dynamics, which led to greater business stability in the latter weeks of the quarter.

- Most notably we took action in China and Europe to address an inventory build-up that occurred in the first quarter of 2011.

- We took a more responsive approach to product pricing around the world.

- We have shifted our sales focus and marketing resources more towards retail interactions with consumers.

- We made changes in certain critical sales management.

During this time of transition, we expect competitive pressures to continue. However, we have a clear strategy to address the concerns about our product competitiveness. In Q2, both our Smart Devices and Mobile Phones business units moved forward on their plans.

- In Smart Devices, those who already have viewed our early Windows Phone work are very optimistic about the devices Nokia will bring to market and about the long-term opportunities. Step by step, beginning this year, we plan to have a sequence of concentrated product launches in specific countries, systematically increasing the number of countries and launch partners.

- In Mobile Phones, early results of the Dual SIM product launches are very encouraging, and we are on track to deliver more products this year.

This shift into the execution of our new strategy also has allowed us to identify additional opportunities for operational improvement. We are accelerating our plans for expense reductions, and we now plan to exceed our previous target of non-IFRS operating expense reductions in Devices & Services of EUR 1 billion for the full year 2013.

It was also validated during Q2 that Nokia understands how to take advantage of our strong intellectual property portfolio. We are well positioned to defend against intellectual property claims and to ensure that other industry participants are properly licensed.

Thus, while our Q2 results were clearly disappointing, we are executing well on the initiatives that are most important to our longer term competitiveness. Some progress is already evident, and thus we are targeting to end this year with more net cash and liquid assets than at the end of Q2 2011. We firmly believe that our deliberate and unwavering commitment to making the changes necessary at Nokia is the right way to deal with the disruptive forces in our industry and drive value creation for our shareholders."

Well, one thing is more than sure in this very moment from Nokia, they are fighting forward with heads up high. Nokia is still the worlds biggest mobilephone manufacturer and they are not going anywhere as detractors and competitors wanted them to be.

To view the complete net sales report, CLICK HERE


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