Friday’s are typically feel good days, especially when the sun is shining and summer is just around the corner.
Sadly for Nokia, however, even the blue skies can’t do enough to raise the cloud of gloom surrounding the number one phone maker, who is seeing its profits sink further by the day.
For Nokia CEO Olli-Pekka Kallasvuo things are looking especially bleak, with shareholders raising the proverbial pitchforks before a meeting next week which could prove the Finnish phone chief’s last as CEO.
Reuters speculates that Kallasvuo may be given the chop in favor of some “new blood” which shareholders apparently feel would invigorate the company and give it a sorely needed boost in its competition with the likes of Apple.
Even competitors like Motorola are posting profits as the economic recovery gets into full swing and the mobile market begins to soar once more, leaving Nokia choking on dust.
US market share for Nokia fell to a paltry 7% according to market research outfit Strategy Analytics, which notes the number has fallen from a previous 20%. Globally, Nokia still holds around 35% of the market, but with competitors upping the ante, it’s hard to see that percentage holding up for much longer.
Shareholders aren’t only concerned about Nokia coming up with some killer hardware to take on Apple by the holiday season, Nokia’s software ‘efforts’ are coming under fire too.
With Symbian 3 – Nokia’s great soft hope – delayed, shareholders are literally foaming at the mouth, baying for blood and looking to pin the blame on a scapegoat. Kallasvuo, who has served the company for half his life, is starting to look like a proverbial lamb to the slaughter.
“It wouldn’t surprise me if he goes,” In-Stat analysts Jim McGregor told RCR, adding that it was awful to watch Nokia’s “slow, painful decline.”
“whenever a company goes through such a severe downturn, someone ends up paying the price,” he said.
Even leaked details of Nokia’s upcoming flagship N8 phone left most potential punters cold, and not only owing to the less than sympathetic Russian blog review of the early, yet unfinished prototype. Nokia attempted to do some damage control, but even its own marketing material wasn’t enough to get people excited.
For a firm with such a strong brand name, such valuable manufacturing assets and a solid presence in emerging markets, Nokia really should be on better footing, but the firm seems to have stumbled over the investment in its Ovi Store and Internet services, which have cost shareholders over $10 billion to date.
This wouldn’t be quite so bad if Ovi Store stood a chance against Apple’s app store or even Google’s Android marketplace, but it doesn’t.
Word on Wall Street is the firm will likely not hit its 2011 targets in terms of reaching 300 million users or annual revenues of 2 billion Euros, which will hardly do much for the buy rating on Nokia shares.
Less Ovi, more Oy Vey, Nokia.
