Nokia has done it again. For the second time in three weeks, the world’s biggest handset manufacturer has warned mobiles sales are set to drop more sharply than expected as cash-strapped consumers keep hold of their disposable income.
The Finnish handset behemoth softened the blow slightly for analysts by telling them the news at its annual capital markets day in Brooklyn – handy for any City analysts that fancied defying the strong dollar to go Christmas shopping.
But with people being laid off across all sectors – including the Square Mile – demand for new mobiles is drying up globally.
“The slowdown is apparent in varying degrees everywhere, but the most recent incremental impact in the emerging markets has been more pronounced than in other markets,” Nokia said in a gloomy statement.
Reiterating the message, chief financial officer Rick Simonson told those gathered: “Consumers are continuing to dramatically cut back spending. What’s recently accelerated is the slowdown in emerging markets.”
The company now expects handset market volumes to fall at least five per cent next year, even more than research house Gartner, which is on up to four per cent.
Many analysts had been prepared for such a fall, however, so simultaneous news Nokia had managed to improve its market share helped its shares rise four per cent on the day of the announcement.
But, as Nokia staff with shares and options know all too well, the shares have a long way to recover before they are back up to anything like the levels seen last year. Nokia’s New York-traded stock is down more than 60 per cent in the past 12 months alone.
For full article, see Mobile News issue 429 (December 15, 2009)
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