By Telecom Lead Team: Nokia Siemens Networks has registered 11 percent increase in 2011 sales at EUR 14.04 billion in 2011 compared with EUR 12.66 billion in 2010.
Operating loss in 2011 was EUR 300 million as compared with EUR 686 million in the previous year. Q4 2011 operating profit was EUR 67 million as against EUR 1 million in Q4 2010.
Nokia Siemens Networks completed the acquisition of Motorola Solutions’ networks assets on April 30, 2011. Accordingly, the results of Nokia Siemens Networks for the fourth quarter 2011 are not directly comparable to its results for the fourth quarter 2010.
In Q4 2011, Nokia Siemens Networks’ sales decreased 4 percent to EUR 3.81 billion from EUR 3.96 billion in Q4 2010.
The year-on-year decrease in Nokia Siemens Networks’ net sales in Q4 2011 was driven by a decline in sales of infrastructure equipment, which more than offset the contribution from the acquired Motorola Solutions networks assets and a slight increase in sales of services.
Excluding the acquired Motorola Solutions networks assets, net sales would have decreased by 11 percent year-on-year.
Services represented slightly over 50 percent of Nokia Siemens Networks’ net sales in the fourth quarter 2011.
The higher year-on-year and sequential Nokia Siemens Networks’ gross margin in the fourth quarter 2011 was primarily due to higher software sales, improved performance in services and the contribution from the acquired Motorola assets.
Nokia Siemens Networks’ research and development expenses increased 10 percent year-on-year primarily due to the addition of research and development operations relating to the acquired Motorola Solutions networks assets as well as investments in strategic initiatives.
On November 23, 2011, Nokia Siemens announced its strategy to focus on mobile broadband and services and the launch of an extensive global restructuring program.
Nokia Siemens plans to realign its business to focus on mobile broadband (including optical), customer experience management and services. Nokia Siemens services organization will further strengthen its global delivery system. Business areas not consistent with the new strategy are planned to be divested or managed for value. Quality and innovation will continue to be priorities for the company, with ongoing investment in both areas.
Nokia Siemens Networks targets to reduce its annualized operating expenses and production overheads by EUR 1 billion by the end of 2013, compared to the end of 2011.
Nokia Siemens Networks plans to reduce its global workforce by approximately 17 000 by the end of 2013. These planned reductions are expected to be driven by aligning the company’s workforce with its new strategy as well as through a range of productivity and efficiency measures.
In the first quarter of 2012, Nokia Siemens Network expects substantial charges related to this restructuring program.