Nokia Promises New Lumia Flagship As Sales of Smartphones Collapse

Sales of Nokia Lumia Grow Modestly, Nokia Readies New Flagship Smartphone

by Anton Shilov
04/18/2013 | 08:43 PM

Nokia Corp. on Thursday disclosed sales results for the first quarter of 2013. As expected, shipments of its Windows Phone-based Lumia smartphones increased modestly during the quarter, but the total sales of smartphones dropped to a new low. In a bid to improve sales of smartphones in the coming quarters, chief exec of the company promised to introduce a new flagship already this quarter.


Nokia Lumia Q1 volumes increased 27% quarter-on-quarter to 5.6 million units, reflecting increasing momentum. At the same time, sales of Symbian-based smartphones collapsed to 500 thousand a quarter, which indicates that the platform is nearly dear. Sales of smartphones in Q1 decreased to 6.1 million units, down from 10.2 million units a year ago and 6.6 million units a quarter ago. Thanks to the shift to Windows Phone platform, average selling price of a Nokia smartphone increased to $191 from $143 a year ago quarter and from $183 in Q4 2012.

Although Nokia has introduced a broad portfolio of Windows Phone 8-based handsets since September, targeting different market segments, sales of Lumia did not skyrocket to numbers comparable to shipments of Google Android-based devices. As a result, the company announced to refresh the lineup of Lumias with a new flagship model.

“Later this quarter, a new Lumia device is anticipated to have hero status with a leading U.S. operator, and event which will mark the beginning of a season of new product introductions,” said Stephen Elop, chief executive officer of Nokia, during a quarterly conference call with financial analysts.

When pure smartphone shipments are considered, it becomes obvious that Lumia product line has been growing slower than Symbian was falling, an indicator that Nokia’s loyal customers are defecting to other platforms and not transiting to Windows Phone. It is highly likely that in the ongoing quarter sales of Symbian-based devices will stall and the company will have to write down all the remaining inventory and report a massive loss. Starting from Q2 2013 virtually all Nokia smartphones will be powered by Windows Phone operating system and it remains to be seen how fast their sales will grow to the levels of Symbian back in Q1 2011.

It is evident that Nokia’s management pins loads of hopes onto marketing campaigns organized by Microsoft and carriers and not exactly on competitive functionality of its Lumia handsets compared to Apple iPhone and Google Android-based handsets.

“Nokia, Microsoft and operators have committed to increase the global Windows Phone marketing dollars towards Lumia. Together with Microsoft we are working on major marketing campaigns, training more retail associates, improving how we leverage operator marketing that is available to us, and seeding more live devices to create a more engaging point of sale experience. Overall, we are very pleased with our progress around Lumia,” said Mr. Elop.

Although nothing particular is known about the new flagship Lumia device from Nokia, it is obvious that the product will not feature a quad-core application processor or a full-HD display due to limitations of the current Windows Phone 8. The aforementioned functionality will be supported only by next-gen WP platform due in late 2013.