Nearly everything Nokia reported during its earnings call was bad news from down sales (down 7% from last year, 11% from last quarter), earnings per share, net cash and more. Nokia says it sold 16.7 million smartphones in the previous quarter (April through June) which means Apple iPhone surpassed Nokia in smartphone sales. During that same time, Apple sold over 20 million iPhones.

Nokia CEO Stephen Elop spins this as a transition period and says that things will be better soon.

"We're starting to see a very positive impact on the health of Nokia," he says, referring to the numerous changes the company has taken over previous months, which have included everything from management shuffling, pricing adjustments and shifts in sales focus and marketing resources, to name a few.

Whether Nokia was right to choose Microsoft's Windows Phone over Google's Android as its new smartphone platform of choice remains to be seen. But it's clear that Nokia was right to make adjustments to its core business. The company plans to release its first phones running on Windows 7 OS in the last quarter this year.

"In Smart Devices," said Elop, "those who already have viewed our early Windows Phone work are very optimistic about the devices Nokia will bring to market and about the long-term opportunities."

Nokia has been struggling to maintain its lead in the mobile phone market since 2008. Now it faces intense pressure from the growing number of Android-based phones as well as Apples iPhones, according to ReadWriteWeb.