Nokia (NOK) named Rajeev Suri as its new CEO, elevating the leader of Nokia Solutions and Networks now that it has completed the sale of its device business to Microsoft. Suri replaces Stephen Elop, a former Microsoft executive who oversaw Nokia’s move into Windows-based smartphones, and who returned to Microsoft along with the handset unit.
Suri has been at NSN for almost 20 years, and is credited with growing revenue by improving the contract mix, and with cutting costs as well. Suri said NSN may look at buying some smaller companies in the months ahead in order to fill in gaps in its product line.
Nokia also reported earnings for the first quarter today. Revenue at the network unit was $3.12 billion, down 17% from the year-ago quarter in part due to currency fluctuations. The profit picture was brighter – non IFRS operating profit was $298 million, up 10% from the year-ago quarter. NSN’s operating margin of 9.3% was up 23 basis points from the year-ago quarter, boosted by a software sales and mobile broadband sales, both of which can deliver higher margins than traditional telecom hardware.
Although NSN is now the bulk of Nokia’s business, the company also retains its maps software unit HERE (Q1 external sales $255 million) and it still has its patent licensing business, which is expected to see an uptick in revenue now that the device unit has been sold. In the past, Nokia’s patent unit struck cross-licensing deals with competing smartphone makers, but going forward it will not have to pay for smartphone patents because it will not need them anymore.
