Slumping into the red, Nokia on Thursday posted a loss of 492 million euros for the three months ended June, as decline in sales continued to hurt the Finnish mobile phone maker.

Nokia, which has posted a loss for the first time in more than a year, raked in revenues of 9.28 billion euros in the 2011 second quarter.

The world’s largest cell phone maker recorded a steep drop in sales volume as well as marginal fall in revenues, amid intense competition from players such as Apple and HTC in the fast-growing smart phone segment.

The entity, which has a good presence in India, had a profit of 104 million euros on revenues of 10 billion euros in the year-ago period, it said in a statement.

Mobile phone volumes tumbled to 71.8 million units in the latest June quarter as against 85.8 million units in the same period an year-ago.

“On a year-on-year and sequential basis, the declines in our total devices & services volumes were driven by declines in both our smart devices and mobile phones volumes, with a greater percentage decline in our smart devices volumes,” the statement noted.

Meanwhile, Nokia benefited from the recognition of about 430 million euros of IPR royalty income related to second quarter and earlier periods.

“The challenges we are facing during our strategic transformation manifested in a greater than expected way in Q2 2011,” Nokia CEO Stephen Elop said.

Stressing that second-quarter results were “clearly disappointing”, Elop noted that the company expects competitive pressures to continue.

“In mobile phones, early results of the dual SIM product launches are very encouraging, and we are on track to deliver more products this year,” Elop said.

Among others, Nokia had entered into a pact with Microsoft for a partnership and also reached a settlement with Apple on patent-related litigations in the 2011 June quarter.

Earlier this year, Nokia had entered into an agreement with Accenture that would see outsourcing of Symbian software development and support activities.

“Approximately 2,800 Nokia employees located in China, Finland, India, the UK and the US, are expected to transfer to Accenture at closing, which is expected to take place in the early part of October 2011,” the statement said.

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