Speculations have been rife about Nokia dishing out its HERE mapping division to a third-party vendor. While reports have come in that a German Luxury Car Consortium has reportedly grabbed one of the finest mapping services on earth, we have finally got first hints towards Nokia’s intentions of selling off HERE division.
These hints came via Nokia CEO Rajeev Suri, who issued a prepared statement during Nokia’s impressive Q2 earnings result. While Suri issued statements for each of Nokia’s current divisions, his statement on HERE is what hinted that the mapping division might be up for sale.
Talking about HERE’S profits, Suri said [emphasis my own],
HERE continued to deliver well, again showing year-on-year sales and profitability growth. Our strategic review of that business is now in an advanced stage, and I would like to reiterate that our focus is on what is in the best interests of our shareholders and the long term future of HERE.
Those emphasised words, specially the “strategic review is on advanced stage” part is a clear enough indication, that the company is indeed looking a strategic sale of its mapping division. Moreover, Suri’s talk about HERE’s future further cements that a sale talk with potential buyers might be on.
HERE has been a rewarding business for Nokia, and that is probably the sole reason why the company is not hurrying up to sell the business at a lower-than-expected bid.
Nokia’s mapping division clocked a 25% year-on-year growth in net sales, with 24% growth in new vehicle licenses for embedded navigation systems. HERE further recorded a Non-IFRS operating profit of EUR 27 million ($29 Million), with non-IFRS operating margin increasing year-on-year to 9.3% from 0.0%.
Overall, Nokia has risen impressively post its smartphone business sale to Microsoft, which ironically, has brought more good to the seller than the buyer.
Nokia’s net sales in Q2 2015 clocked a whopping EUR 3.2 billion ($3.5 Billion), as compared to the EUR 2.9 billion ($3.17 Billion) in Q2 2014, up 9% year-on-year (down 1% year-on-year on a constant currency basis)
Non-IFRS diluted EPS in Q2 2015 of EUR 0.09 (EUR 0.06 in Q2 2014), an increase of 50% year-on-year; reported diluted EPS in Q2 2015 of EUR 0.09 (loss of EUR 0.01 in Q2 2014).