Nokia adds $1.9B to Microsoft's revenue in Q4 but cuts into firm's profit

The Nokia purchase added nearly $2 billion to the company’s Q4 revenue, but the cost hit the quarter’s bottom line.

Microsoft’s acquisition of Nokia’s phone business contributed $1.99 billion to its current year revenue, according to today’s fourth quarter earnings report from the tech giant. The operating loss from the acquisition was $692 million. But the overall cost of the purchase contributed to the company’s 7.1 percent decline in fourth quarter profit.

The acquisition of Nokia was completed by April 25, after which the revenue and cost of revenue from Nokia’s Devices and Services (NDS) business, including amortization of intangible assets, were rolled up into a new Phone Hardware segment.

The Phone Hardware revenue, which is included in Devices & Consumer revenue, came from Lumia smartphones and other Nokia phones. Microsoft reported that it sold 5.8 million Lumia units and 30.3 million non-Lumia phones, and said that lower price devices were the drivers.

The report did not break out the sales of Android-based phones in Nokia’s X line. When the company recently announced layoffs of 18,000 employees, including half of Nokia’s workforce, it also said it was getting out of the business of making Android devices.