Mobile broadband solutions provider NSN third quarter revenue plummeted 26 percent to $3.6 billion (€2,592 million).
The drastic dip in sales was partially due to divestments of businesses as well as the exiting of certain customer contracts and countries. It sold a number of businesses including WiMax in the last 18 months to focus more on mobile broadband.
Excluding these two factors, NSN net sales in the third quarter 2013 declined by approximately 20 percent primarily due to reduced wireless infrastructure deployment activity, which affected both mobile broadband and global services.
Ericsson, the main rival of NSN, last week said its revenues were impacted due to low investment in mobile infrastructure. Ericsson global revenue decreased 3 percent to $8.4 billion (SEK 53 billion). Its net income increased 38 percent to SEK 3 billion.
But NSN revenue performance is worse as compared with Ericsson. NSN quarterly revenue is $3.6 billion as compared with Ericsson’s $8.4 billion. In addition, Ericsson revenue dipped 3 percent as compared with NSN’s 26 percent in the third quarter.
NSN on Tuesday said sales from broadband business, its primary business, was €1,259 million from €1,625 million, declining 23 percent y-o-y.
Global services revenue dipped 22 percent to €1,331 million from €1,701 million.
Net negative effect of foreign currency fluctuations also impacted NSN revenue, NSN said on Tuesday.
According to NSN, the year-on-year decrease in Mobile Broadband was primarily due to lower sales in WCDMA, GSM and CDMA.
Within mobile broadband, LTE was approximately flat year-on-year as higher sales in North America, Europe and Latin America offset lower sales in Japan and Korea.
Decrease in Global Services was primarily due to a reduction in network implementation activity, consistent with lower levels of large scale Mobile Broadband deployments, and the exiting of certain contracts in line with NSN’s strategic focus.
“On a regional basis, we had lower cyclical sales in Asia Pacific following high levels of spending a year ago. In Europe, the sales decline was primarily related to network modernization and divestments in line with our strategy. The sales decline in Latin America was primarily driven by constrained operator spending and certain contract exits. Decline in Middle East and Africa was primarily due to country exits,” NSN said in a statement.
