Now that Nokia is just another small guy lets not give them too much attention anymore..
LG STUMBLE AND REPORT LOSS AGAIN
LG reports Q3 quarterly results. For Q2 of 2013 LG was third largest smartphone maker selling 12.1 million smartphones, profitably. Now we get their latest results and there seems to be emerging a 'Third Rank Curse' which prevents anyone from holding onto that position (in last 5 quarters we've had 4 companies holding 3rd place - Nokia, Sony, Huawei and LG. This Quarter gives us a new 3rd place ranking company again).
So yeah, LG sold 12.0 million smartphones, which gives them a preliminary market share of 4.8%, down from 5.2% in Q3. Their Top 3 ranking is gone, they now are hoping for 4th, and might be as low as 7th, competing with Lenovo, ZTE and Sony. Very likely they outsold Coolpad/Yulong. The more alarming news for LG is that their handset unit is back to making a loss again after some profits. Life's not-so-good nowadays over at Life's Good.
NOKIA GROW SMARTPHONE UNIT SALES BUT ALSO REPORT BIGGER LOSSES AGAIN
So Nokia. The last partial quarter with Elop in charge. The end of the Elop Era. We just got the Nokia results. The overall company made a modest profit - driven by the other (remaining, non-handset) businesses. Nokia's handset unit again reported a loss. Not because of bad dumbphones - the dumbphones ie 'featurephones' unit was slightly profitable. The problems continue at the smarpthone unit which now saw increasing losses. But yes, it now seems very clear, Nokia had hit its bottom and has now achieved a 'floor' level as the 'New Normal' which is about 3.3% in global smartphone market share, plus or minus half a percentage point. For the past 5 quarters Nokia has fit comfortably inside this narrow window - 3.7%, 3.0%, 2.9%, 3.2% and now 3.5%. If you want to be an optimist, you say we've hit the bottom and Nokia is now 'rising'. The realist points out that just 18 months ago - yes 6 quarters ago, Nokia's market share was 6.7% and just 2 years ago it was 14.0%. There will not be a heroic return to the early days of Elop in charge when Nokia controlled 34% of the smarpthone market.
So yes. Nokia reports 8.8 million smartphones sold in Q3 of 2013, that is up 19% from Q2 and gives Nokia a preliminary market share of 3.5% currently. Their risk of dropping out of the Top 10 biggest smartphone makers has subsided, as Blackberry (ex RIM) and HTC continue to struggle. Nokia is now fighting Coolpad/Yulong for which gets to claim 8th ranking. Nokia cannot finish worse this quarter than 9th.
We also see the annual numbers becoming quite clear. Nokia will end the year selling around 3% of the total global smartphones, down from 5% last year, 16% in 2011 and down from 35% in 2010, when Elop was hired. Remember Nokia smartphone sales were growing strongly (with increasing and indeed Nokia-record-setting profits) when Elop was hired and every published handset analyst was convinced Nokia would easily remain the world's largest smartphone maker for years to come (with the older strategy, until we got Elop destroying that with the Elop Effect, to pursue his personal bonus of 25 million dollars to wreck the handset division business).
We have seen a nearly perfect transition from Nokia to Samsung. In Q4 of 2010, the last quarter before the Elop Effect, Nokia smartphone market share was 29% and Samsung was 11%. Today Nokia is 3% and Samsung is 33%. Meanwhile we also saw Blackberry collapse from 14% to 2% and HTC fall from 9% to 3%. Did Apple win out of these major collapses? Barely. The iPhone had 16% market share in Q4 of 2010 and has 14% today.. No, the only one who gobbled up all the destroyed rivals was the fastest mover in the smartphone space, the Korean giant we know as Sammy...
Back to Nokia. We can see the bottom, Nokia natural share in smartphones now in the Lumia age is about 3.3%, literally just one tenth of what Nokia smartphones owned of the market before Elop wrecked the business. And its also true, that since the Elop Effect, until Elop left Nokia, not once has the smartphone unit managed to produce a profit. The smarpthone unit had never reported a loss before Elop came into town. Now for Nokia/Microsoft, the next stage is to cure this company of its losses, and try to bring the smartphone unit to a sustainable business level, ie nominal profits or at least about neutral standing. Of course if the Nokia shareholders approve the sale of the handset unit to Microsoft, then the 'Nokia' handset business will become a side business for Microsoft and it can afford to run it with losses for years, like it did when it prepared the Xbox gaming console business to eventually become viable profitable and market leading business.