Microsoft Profits Fall As the Company Absorbs Nokia Losses
Microsoft has announced a 7 percent fall in its quarterly profits, as its performance was hurt by losses at its new Nokia handset division.
The company said that profits fell to USD4.6 billion, fromUSD4.97 billion a year, ago, thanks largely to a USD692 million loss at Nokia handsets.
Last week the company announced 12,500 job cuts at the Nokia division, as well as as 5,500 redundancies across the rest of the company as it starts to tie the handsets division into the rest of the company’s services.
The company has around 127,000 employees.
“We are driving growth with disciplined decisions, bold innovation, and focused execution”.
Said chief executive Satya Nadella in a statement, choosing to focus on revenues from Microsoft’s cloud computing division, which he said were set to double this year, reaching USD4.4 billion.
Revenues for the quarter came in at USD23.4 billion, compared to US$19.9 billion a year ago. The Nokia business contributed $1.99 billion to current year revenue.
Microsoft sold 5.8 million Lumia Smartphones, and 30.3 million non-Lumia phones following the completion of the Nokia acquisition. Low price point devices drove a majority of the Lumia Smartphone volumes, while Non-Lumia phone volumes were simply said to have “performed in line with the market for this category of devices”.