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The price for slow reactions to reality as Nokia shares continues its tumbling on Thursday
Thursday, 12 April 2012
Finnish mobile phone giant Nokia's shares continued their downward
spiral on Thursday following Wednesday’s profit warning. Nokia shares
opened 5 percent down in morning trading on the Helsinki Stock Exchange.
On Wednesday, Nokia shares nosedived about 15 percent in Helsinki and
also fell in New York as the company comes to terms with its weak
approach to the growth market of smart phones where the money is.
As a result, the company’s forecast of lower-than-expected profits for
the first and second quarters of 2012 gave the company’s share a bloody
nose yesterday.
The official Q1 results are to be published next Thursday, and the
mobile phone maker says it will not comment on its finances further
until those figures are out.
Nokia’s management announced on Wednesday that the result will be worse
than expected in the first quarter. According to the company's
management it was driven by the increasingly intense competition
dragging Nokia's mobile phone sales. Also there were reports that its
new Nokia Lumia 900 phones have been affected by difficulties to
connect to the internet and other software issues.
“Nokia has been performing badly over several years and this is one in
a long series of warnings. The emergence of new problems in which Nokia
has not quite managed just compound to the problems the company is
going through. The world has been moving a little faster than Nokia
has” said Hakan Wranne, telecoms analyst at Swedbank, Sweden.
Yesterday, Nokia President and CEO Stephen Elop said the company will
be taking sharp measures to turn recent earning trends around. That,
the company will invest more in its Windows-based Lumia smartphone
product family. In addition, new products were to be launched in the
period of April through June. New pricing for lower-end phones was also
to be part of the planned counterstrike.
"Within our Smart Devices business unit, we are increasing our
investments in Lumia: to more consumers and to more markets," Elop told
a phone conference aimed at investors.
By Scancomark.se Team
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