Nokia gives up predicting sales
Shares tumble on storm warning
Nokia is predicting Q2 sales to be "substantially below" its previous estimates, and says it won't provide public targets anymore as the company tries to adjust to the new reality.
In its statement to the stock market Nokia doesn't say how much worse things will be, only that "multiple factors are negatively impacting Nokia's Devices and Services" and that its previous estimate of €6.1bn to €6.6bn for the second quarter of 2011 could be as much as 9 per cent off, and that the company feels unable to predict what's going to happen for the rest of the year.
The fall is attributed to Nokia being unable to shift enough high-end (and high-margin) handsets, which is no great surprise given the mess the company has made of its smartphone strategy over the last few years.
In a statement Stephen Elop, Nokia's CEO, said the company must "accelerate the pace of our transition" and that he remained confident that Nokia would have Windows Phone handsets out this year.
The company also pointed out that it has started shipping a dual-SIM handset for the first time. Dual SIMs enable customers to take advantage of multiple operator tariffs; such handsets are common in most of the world but disliked by western operators.
Nokia is also steaming ahead with cuts to prices, and expenses, and increasing point-of-sale marketing.
But that's not reassured the markets much, with Nokia's share price dropping 15 per cent on the news.
We won't know how bad that news really is until the Q2 results on 21 July, but with this release Nokia is letting the world know that the news won't be good. ®
"(Nokia) says it won't provide public targets anymore as the company tries to adjust to the new reality.".
One assumes that's the new reality that no-one was buying Windows handsets before Nokia, no-one is going to buy windows handsets after Nokia and no-one is buying Symbian handsets as Nokia have nailed it to the cross.
A company destined to become just another chapter in a book on Marketing Blunders. A footnote in the Smartphone industry.
By the time the Nokia WP comes out the company will have gone from a market cap of $35bn to somewhere close to single digit billions. Wouldn't surprise me if they snapped up by Microsoft, or even one of the Taiwanese or Chinese outfits.
Elop has been nothing but a disaster for Nokia so far - it's true they were in trouble before, but all he's done is accelerate that. They may have been on a burning platform (if you believe that), but now they're under water and drowning.
Judging by this announcement it's clear the operators are not stocking Symbian any more - and who can blame them? It's difficult to see who will now be buying the 150mn Symbian devices Nokia believed it would be able to sell back in February, and since very few appear to be buying Windows Phone devices it's hard to imagine the slack will be taken up by consumers saving their pennies for once the Nokia WP hits the shelves. If they wanted a WP device they'd already have one. They don't, and a device from Nokia will make precious little difference.
Nokia have only two choice: stick with Elop and hope that WP7 takes off before they run out of money, or ditch Elop along with his strategy and go back to basics of running your own platform which was orders of magnitude more popular than the one from Microsoft.
Either way Elop should be prosecuted for destroying shareholder value with his incompetence.
I wonder why?
He's already announced the end of Symbian, so why would people want to buy into a fading platform? Personally I think Symbian is getting better all the time - but Elop has tainted it with death, as soon as he opened his mouth....And he has bugger all else to sell, the idiot.