Satya Nadella (left) & Stephen Elop men with some big fish to fry
According to its new CEO Rajeev Suri Nokia, having shed its loss making mobile phone business, is going to payback $2Bn in debt and resume paying dividends.
The sale on 25th April 2014 of the loss making Nokia Devices and Services business to Microsoft for €5.6Bn has left Nokia with three profitable units the Networks business, an R&D and Intellectual Property unit called Technologies and a location services business called Here. Between them they booked a $216M operating profit in 1Q 2014.
Nokia’s market value is now about 20 billion euros, down from 300 billion euros it was in 2000, when Nokia was the dominant global mobile phone supplier. Nokia started out in the 1860′s making rubber products including gumboots and is nothing if it is not a surviver.
The Nokia phone business lost €326 million in the last quarter it was in Nokia’s hands (1Q 2014) and it is not clear what Microsoft plans to do to turn this around. Former Nokia President and CEO Stephen Elop, is now Executive Vice President of the Microsoft Devices Group reporting to Microsoft CEO Satya Nadella. Elop is now looking after Lumia smartphones and tablets, Nokia mobile phones, Xbox hardware, Surface, Perceptive Pixel (PPI) products, and accessories.
Elop said they are working on branding but that they won’t be using Nokia or Windows Phone. Microsoft’s communication on the arrangement is here.
Watch this space.