Nokia Corp.
(
NOK
) has suffered a setback as Standard & Poor's Ratings Services
(S&P) downgraded its credit rating. Currently, S&P rates
Nokia as BBB-, which is the lowest rank of the rating agency's
investment grade category. As per S&P, Nokia's partnership with
Microsoft Corp.
(
MSFT
) may help the company to strengthen its competitive position in
the global smartphone market, but significant fall in demand for
the company's legacy Symbian-based handsets will more than offset
the positives of Windows Phone based smartphones.
Quarterly net revenue in the fourth quarter of 2011 was
approximately $13,496.7 million, down 21% year over year.
Smartdevices (including smartphones and tablets) revenue was
$3,705.7 million, down 38% year over year. Mobile Feature Phone
revenue was $4,101 million, down 23% year over year. Smartdevices
average selling price (
ASP
) was $188.9, down 9% year over year. Mobile Feature Phone ASP was
$43.2, down 24% year over year. In the fourth quarter of 2011,
Nokia shipped 19.6 million smartdevices and 93.9 million Mobile
Feature Phones, down 31% and 1% year over year, respectively.
Despite fairly good market traction for its Lumia series of
Windows Phone-based smartphones, Nokia's top line fell primarily
due to poor performance of its Symbian-based handsets compared with
low-cost handsets from Samsung, LG, and HTC in the Asian markets.
Furthermore, although technologically Lumia is a solid product, we
are not very sure whether it will be able to gain market share from
Apple Inc.
(
AAPL
) developed iPhone or
Google Inc.
(
GOOG
) developed Android based smartphones in the most lucrative North
American markets.
S&P assigned a negative outlook for Nokia, indicating a
potential downgrade of Nokia's overall credit rating if operating
margin in the company's devices and service business segment remain
in the low-to-mid single digits or if the company's net cash
position declines to below EUR2 billion.
GOOGLE INC-CL A (
GOOG
): Free Stock Analysis Report
MICROSOFT CORP (
MSFT
): Free Stock Analysis Report
NOKIA CP-ADR A (
NOK
): Free Stock Analysis Report
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