“On Friday, the slimmed-down firm [Nokia] upped its 2015 expected operating margin for its networks business to between 8 to 11 percent. The upgrade was widely expected, after Nokia reported operating margin of 11.4 percent in the first nine months of this year, driven by a major project in China as well as high demand for 4G,” Arjun Kharpal reports for CBNC. “This led shares to tumble to close 5.5 percent down on the day, as the margin upgrade was already baked into the share price.”
“The capital day came after Nokia sold its cash-burning ‘Devices and services’ business to Microsoft earlier this year for 5.44 billion euros ($6.78 billion). The company is a different beast to the company that once dominated the mobile handset space and bolstered the Finnish economy—until it fell behind in the rapidly moving smartphone market that Apple and Samsung now control,” Kharpal reports. “While CEO Rajiv Suri is touting the Internet of Things, analysts suggest that Nokia’s patents and licensing business, known as Technologies, could be its most lucrative unit. Nokia Technologies saw a 13 percent rise in operating profit in the first nine months of the year, compared to the same time last year. ‘As a whole, the key profit driver during the upcoming years will be the technologies unit and licensing business,’ Mikael Rautanen, technology analyst at Inderes, told CNBC by phone.”
“Suri ruled out a direct return to the handset market at the investor conference, but said the brand could reappear under license. This would mean Nokia selling their brand to smartphone makers, a move that would be dramatic, according to Rautanen,” Kharpal reports. “‘Now they don’t have the mobile phone business, the patent portfolio will make good money for the company and this dramatically changes the dynamics of the licensing business,’ Rautanen said.”
Read more in the full article here.
MacDailyNews Take:
Apple’s iPhone is a “niche product.” — Nokia’s then-CEO Olli-Pekka Kallasvuo, April 17, 2008
Olli-Pekka is currently “spending time with his family.”
[Thanks to MacDailyNews Reader “Edward W.” for the heads up.]
So we will go into niche products ourselves in an attempt to copy Apple inc. surmised Mr. Pekka as he watched his wood pecker attempt to drill into a fake tree trunk that was a mobile phone mast in disguise!!! 🙂
When Nokia was having trouble years ago, I did think that clinging to Microsoft would be like a drowning person grabbing a lead anchor.
Oh just buy M$ and get it over with all ready.
(yes, I’m kidding, well, kinda)
That would be committing a “Mikey Dell” but I appreciate the “buy Microsoft & shut it down” sentiment. The world would then be a much better place.
A bloody waste of money. Microsoft will survive on “monopoly rent” for years to come, but will otherwise be a niche player with few paying attention or following its lead.
Yep. They have “innovated” themselves to the state of irrelevance and at this point unlikely to recover the world’s confidence or trust in much anything they do.
MDN take. lol! 😝
so why is his beleaguered? The upgraded margin guidance and the analyst comments sound pretty up beat & positive