Nokia Stabilizes, Aims For Number 3

Nokia is trending up, even if it is still treading water.

The first quarter of 2013 saw Nokia ship more Lumia smartphones than any other quarter since it launched smartphones using Microsoft’s Windows Phone platform. Nokia shipped 5.6 million Lumia devices, up from 4.4 million in the final quarter of 2012. The Lumia growth is impressive considering the majority of the Windows Phone ecosystem has been dismal in comparison to its Apple and Android counterparts.

Overall, Nokia posted a small loss on the quarter of about $196 million on revenue of $7.65 billion across all of its properties. Mobile devices make up about 49.3% of Nokia’s revenue, with smart devices (such as the Lumia) about 20%. Nokia is still hemorrhaging sales in its non-smartphone division, with shipments down to 55.8 million, nearly 30 million units less than in Q4 2012 and 15 million less from Q1 2012. In terms of revenue, non-smartphones still make more money for Nokia than do Lumia devices, with 27% of the company’s overall revenue.

Nokia In Perspective

We tend to position the battle for number 3 as a clash between Nokia and BlackBerry. This, of course, is not necessarily true as Asian Android manufacturers like Huawei, ZTE and LG all ship more smartphones than either BlackBerry or Nokia. The notion is that one non-Android manufacturer will eventually rise above the heap to stake claim to the No. 3 spot behind Apple and Samsung.

Both Nokia and BlackBerry had decent first quarters. Not spectacular, but decent. In limited availability, BlackBerry shipped one million BlackBerry 10 devices and six million smartphones total. Nokia shipped 6.1 million smartphones, with about 500,000 coming from its non-Windows Phone lines including the dying Symbian. 

On the surface, the fight is even. But if we try to predict the near future, we see that BlackBerry is still relying on its long tail of BlackBerry 7 (and before) smartphones for much of its device sales while Nokia has seemingly turned the corner with Windows Phone, which account for the vast majority of its smartphone shipments. 

Neither company is going bankrupt any time soon. Both BlackBerry and Nokia reorganized their corporate structures (read: layoffs) over the last year to cut down on costs and both are basically breaking even at this point.

In a recent ReadWrite poll with about 700 respondents, 36.23% of our readers thought that BlackBerry would take the No. 3 slot while 55.63% thought Windows Phone would stake claim to the spot.

Both BlackBerry and Nokia are sitting on cash. Not an Apple-like horde of cash, but not an amount to dismiss either. Nokia’s net cash at the end of the quarter was $5.87 billion while BlackBerry is just short of $3 billion. With both companies running leaner coming out of 2012, those cash reserves should give both companies runway to create new products and marketing campaigns to push their devices and effectively compete in the global smartphone market.