Boosted by Motorola buy and Asia Pacific, Nokia Siemens posts 16 percent growth in Q3 net sales

Nokia Siemens Networks posted 16 percent increase in net
sales at EUR 3,413 million in Q3 2011 as compared with EUR 2,943 million in Q3 2010.

The substantial increase in net sales is primarily because
of its 38 percent growth in the Asia Pacific region including India (excluding
China).

In the Asia Pacific region, Nokia Siemens  clocked
EUR 978 million in Q3 2011 from EUR 711 million in Q3 2010. However, China gave
disappointment to Nokia Siemens with -3 percent growth at EUR 302 million in
Q3.

Nokia Siemens strengthened its business in both North
America and Latin America. The net sales in North America grew 74 percent to
EUR 304 million in Q3 2011 from EUR 175 million in Q3 2010. In Latin America,
one of the emerging telecom markets, Nokia Siemens posted 32 percent increase
to EUR 454 million from EUR 345 million.

The growth in Europe was flat at EUR 1,074 million. In the
Middle East and Africa region, Nokia Siemens recorded -9 percent growth.

I am encouraged by the progress we made during Q3, while
noting that there are still many important steps ahead in our journey of
transformation. With each step, you will see us methodically implement our
strategy, pursuing steady improvement through a period that has known
transition risks, while also dealing with the various unexpected ups and downs
that typify the dynamic nature of our industry. During the third quarter, we
continued to take the action necessary to drive the structural changes required
for Nokia’s long-term success,”¬Ě said Stephen Elop, CEO of Nokia.

The year-on-year increase in Nokia Siemens Networks’ net
sales in the third quarter 2011 was driven primarily by growth from the
acquired Motorola Solutions networks assets. Excluding the acquired Motorola
Solutions networks assets, net sales would have increased 3 percent
year-on-year, driven by growth in the Global Services business unit, which
represented approximately 50 percent of Nokia Siemens Networks’ net sales in
the third quarter 2011.

The sequential decline in Nokia Siemens Networks’ net sales
in the third quarter 2011 was driven primarily by industry seasonality as well
as some impact from the current macroeconomic uncertainty. Excluding the
acquired Motorola Solutions networks assets, Nokia Siemens Networks’ net sales
would have decreased 12 percent sequentially.

The higher year-on-year Nokia Siemens Networks non-IFRS
gross margin in the third quarter 2011 was primarily due to improved overall
cost control, operational execution and the increase in net sales primarily
driven by the contribution from the acquired Motorola Solutions networks
assets.

 

Nokia Siemens Networks’ non-IFRS research and development
expenses increased 18 percent year-on-year and 4 percent sequentially,
primarily due to the addition of R&D operations relating to the acquired
Motorola Solutions networks assets as well as investments in strategic
initiatives.

The higher year-on-year Nokia Siemens Networks non-IFRS
operating margin in the third quarter 2011 primarily reflected the higher net
sales and gross margin, partially offset by increased operating expenses.

Nokia Siemens Networks announced a number of mobile
broadband deals.

These included: with STC in Saudi Arabia, its first
commercial TD-LTE (4G) network; a complete core and radio LTE network for
Latvijas Mobilais Telefons in Latvia; LTE and 3G modernization for TeliaSonera
Finland; a major, two city, trial of TD-LTE with China Mobile in Hangzhou and
Xiamen; named as a key supplier for the 4G (LTE) service launch of Bell in
Canada; upgrading T-Mobile USA’s 4G (HSPA+) network to 42Mbps; upgrading the
WIND Telecommunicazioni network in Italy to 42Mbps HSPA+ and preparation for
LTE; deploying WiMAX with VeeTIME to offer broadband aboard the Taiwan high
speed rail service; and replacing and significantly expanding the GO Malta
network with its GSM, 3G and all-IP mobile backhaul technology.

By Baburajan K
[email protected]