“Nokia Oyj’s debt, already at junk status at the three biggest rating companies, was lowered further by two steps at Fitch Ratings after the Finnish mobile- phone maker’s second-quarter loss widened,” Cornelius Rahn reports for Bloomberg.
“The long-term rating was cut to BB- from BB+ with a negative outlook, Fitch said in a statement today. Nokia yesterday reported an operating loss at its handset division equivalent to 9.1 percent of revenue adjusted for some items and forecast similar losses for the current period,” Rahn reports. “‘If these operational losses are not reversed, the support that the cash cushion gives the rating is going to be eroded faster, which could lead to further downgrades,’ Fitch said in its statement. Fitch cut Nokia’s debt to junk in April.”
Rahn reports, “The company has announced more than 20,000 job cuts and shuttered production and research sites as it tries to offset a continuing decline in revenue. Chief Executive Officer Stephen Elop is betting on the Lumia smartphone running Microsoft Corp. software to halt gains by Apple Inc.’s iPhone and handsets using Google Inc.’s Android software.”
Read more in the full article here.
MacDailyNews Take: Good luck with that bet, Flop… er, Elop.
Beleaguered Nokia’s Q2 results a disaster and it’s due to get even worse – July 19, 2012