Nokia Siemens Networks, part of the Nokia Corporation, saw sales decline by 7% to £2.4bn in the first quarter of 2012 compared with £2.5bn in Q1 2011 and £3.1bn in Q4 2011 - a fall of 23%. This was driven primarily by a decline in sales of infrastructure equipment, which more than offset a slight increase in sales of services.
Sales in the quarter were down 7% in Europe, 12% in the Middle East and Africa, 35% in Greater China, 11% in Asia-Pacific and 2% in Latin America. Only North America showed an increase, rising by 67%.
Non-IFRS operating profit (excludes special items) showed a loss of £120m compared with a profit of £2.4m in Q1 2011 and a profit of £143m in Q4 2011. Non-IFRS operating margin for the quarter was -5.0%, compared with 0.1% in Q1 2011 and 4.6% in Q4 2011.
The company incurred one-off restructuring costs totalling £631m in the quarter. NSN still expects the cost of restructuring the company to reach Euro 1bn (£0.8bn) by the end of 2012.
On 23 November 2011, NSN announced its strategy to focus on mobile broadband and services and the start of a major global restructuring programme, which could see 17,000 jobs go worldwide. The overall aim is to reduce its annualised operating expenses and production overheads by Euro 1bn by the end of 2013 compared with the end of 2011.
Savings are largely expected to come from organisational streamlining, but the company is also targeting real estate, information technology, product and service procurement costs, overall general and administrative expenses and a significant reduction in the number of its suppliers to further lower costs and improve quality.