Nokia Still Struggles Despite Recent Positive Signs: 10 Reasons Why

 
 
By Don Reisinger  |  Posted 2013-01-10 Email Print this article Print
 
 
 
 
 
 
 


5. The enterprise doesn’t care

The corporate world has stopped caring about Nokia. That’s extremely bad news. Although it’s often overlooked, the enterprise is a key driver in mobile success. When enterprises select a mobile product as a corporate standard, consumers tend to follow. When the corporate world ignores a product, consumers will also tend to ignore it. RIM is dealing with this problem right now. But Nokia has been the victim of it for years.

6. Revenue is still way down

Although Nokia’s fourth-quarter revenue beat analyst estimates, it was still far below what the company generated last year. In fact, Nokia estimates that its fourth-quarter sales for devices and services were about 3.9 billion Euros. During the same period in 2011, its devices and services business nearly doubled that tally. That’s not the sign of a healthy company.

7. Total shipments aren’t rebounding fast enough

It’s worth noting that while Lumia shipments are up, year-over-year, Nokia's overall handset shipments are down. Even with a strong fourth quarter, that trend hasn’t changed. In fact, Nokia says that during the first quarter of 2013, it expects shipments (and revenue) to slide on a year-over-year basis. That’s bad news for Nokia shareholders.

8. There’s no true vision for the future

What does the future look like for Nokia? Nokia CEO Stephen Elop has said countless times that his company has a strategy to regain lost market share, but so far he hasn’t fully explained his plans to anyone outside of the executive team. What’s worse, his plans, whatever they are, don’t appear to be working. It’s about time Nokia enunciates a true vision for the future and gets its operation back on track.

9. The company’s financial solvency is being called into question

Nokia’s bond rating has been reduced countless times over the past few years, until it finally hit junk status. The S&P and Fitch have both called into question Nokia’s chances of survival. If credit agencies aren’t confident that Nokia can survive, why should anyone else believe otherwise?

10. The U.S. is a huge concern

A key component in Nokia’s troubles is its inability to grow sales in the U.S. market. Granted, the company’s products are sold by U.S. mobile carriers, but few customers walk into carriers’ stores asking for a Nokia device. What’s worse, Nokia has done nothing to effectively market its products to those customers. Until U.S. phone buyers start thinking positively again about Nokia’s phones, the mobile company is in deep, deep trouble.

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