Nokia Networks booked a €1.2 billion hit to operating profits at its HERE mapping business, a black mark amid a strong set of Q3 figures.
Revenues at the Finland-based vendor reached €3.3 billion, a 13 percent year-on-year increase, with rises in all three of its business units.
But sales at its global services division fell five percent due to what the company said was a reduction in network implementation activity, maintenance services and managed services.
Networks sales were up by nine percent in Europe and 53 percent in North America, while Asia-Pac and Lat-Am registered declines.
The company’s Nokia Technologies business also saw revenues increase. Sales rose nine percent to €152 million thanks to Microsoft becoming a more significant intellectual property licensee, in conjunction with the sale of substantially all of the Devices & Services business to the US company, and higher intellectual property licensing income.
Meanwhile, sales at HERE rose 12 percent to €236 million after it sold map data licenses for the embedded navigation systems of 3.2 million new vehicles, up from 2.6 million last year.
But the figures were overshadowed by the €1.2 billion goodwill impairment charge, which the company said was based on an estimate that the recoverable amount of HERE is €2.0 billion.
In a bid to soften the blow, Nokia announced it had promoted Sean Fernback to the role of HERE President, replacing Michael Halbherr, who left the business earlier this year.
Fernback, who joined Nokia in early 2014 from TomTom and steps up from his Senior Vice President position, will start his new role on 1 November.
CEO Rajiv Suri commented: “We are sharpening HERE’s strategy in order to better balance growth and profitability while ensuring relentless focus on priority segments such as automotive.”
Overall, the Chief Executive expressed his delight at the figures.
He said: “Nokia’s third quarter results demonstrate our strong position in a world where technology is undergoing significant change. Performance at Nokia Networks was particularly satisfying, with both growth and improved profitability.
“That said, I also want to be clear that Networks benefited from some unique developments in the quarter, with a business mix weighted towards mobile broadband and regional mix that included strong gains in North America.”