Finnish vendor Nokia will set out a turnaround strategy on 11 February to address significant competition challenges, recently joined CEO Stephen Elop said yesterday.
Announcing Q4 net profit down to E742m from E882m a year ago, Elop warned the group…
Finnish vendor Nokia will set out a turnaround strategy on 11 February to address significant competition challenges, recently joined CEO Stephen Elop said yesterday.
Announcing Q4 net profit down to E742m from E882m a year ago, Elop warned the group “faces some significant challenges in our competitiveness and our execution. In short, the industry changed, and now it’s time for Nokia to change faster”.
Heavy competition from smartphone rivals Apple and Google continues to plague Nokia, which appointed Elop, former head of Microsoft’s business division, as CEO on 21 September to revitalise its business.
Reports suggest a new strategy from Nokia could see it embrace a third party operating system, such as Google’s Android, in addition to its Symbian platform.
Such bold steps are “crucial” for Nokia’s recovery, RBS analyst Didier Scemama told TelecomFinance late last year.
However, placing Nokia’s A2/P-1 ratings on review for possible downgrade, a Moody’s note to investors today cautioned: “Despite the solid contributions of the new [smartphone] models including the new Symbian based N8 and the affordable C3 in Q4, it is still uncertain if they will have a meaningful impact on long-term revenues and margins.
“In addition, the communications networks business conducted by the Nokia and [German vendor] Siemens joint venture NSN continues to dilute group profitability with limited prospects for a substantial near term turnaround.”
Nokia reported revenue up 6% to E12.6bn for the three months to 31 December 2010, compared with E11.9bn a year earlier. The adjusted operating margin at its devices and services division fell to 11.3% for Q4 2010, from 15.4%, with units shipped over the three months 3% lower than a year ago at 123.7 million.
