NEW YORK ( TheStreet) -- As much as I've wanted to like Nokia's (NOK - Get Report) prospects as a good turnaround candidate, it doesn't appear this is a story that's going to end well. Nokia has made great strides to improve its profitability, despite what bulls may want to believe, but the company's still hemorrhaging market share.If management has been unable to capitalize on the collective weaknesses of Apple (AAPL) and BlackBerry (BBRY), investors have to wonder if Nokia can ever turn things around, especially since Samsung's new Galaxy S4 has been considered "underwhelming."
However, profitability was okay. Management's cost-cutting efforts did well, offsetting Nokia's poor sales. The fact that adjusted gross margin improved by almost four points deserves some applause. It's not Apple's level of profitability, but it is progress -- both NSN and the devices businesses improved over last year. Accordingly, Nokia was able to reverse last year's loss in operating income into a modest profit. While profitability is something on which investors can hang their hat, the fact is, cutting costs only looks good on paper. Everything else in this report was a disaster, led by a 25% decline in overall unit sales, which also plummeted 28% sequentially. Fittingly, Nokia's Lumia platform was the lone bright spot in this quarter, advancing by almost 30% sequentially.