While the Q4 2019 was not a good quarter for HMD, the home of Nokia phones, it was the quarter when HMD turned its earnings positive for the first time. Though we are talking about EBIT or earnings before interest and taxes here, this is still significant, as this is the first time when HMD has touched profitability.
This has been reported by FIH Mobile in its earning report.
“The multi-ODM model, combined with a more focused approach in selected markets and thus profitability, helped HMD to turn its EBIT positive for the first time in the fourth quarter of 2019,” FIH Mobile says in a review of its financial position.
We had reported about HMD bracing through a supply chain disruption in H1 2019 and opting for a multi-ODM strategy. The report also revealed that HMD switched to multi-ODM set up in the month of May and the launch of Nokia 2.2, 3.2, 4.2 was done with the help of two new ODMs.
So, in spite of sales of Nokia smartphones shrinking to 2.8 million in Q4 2019 as reported by analyst firms, HMD was able to sell Nokia phones and smartphones at a good margin. The new ODMs may have helped it in keeping the costs low for smartphones and phones they manufactured.
Thanks Keto for the tip. Cheers!!