Nokia facing sales drop

21 July 2011

HELSINKI: Nokia is facing a further sales decline as users turn to Android-powered handsets, new forecasts have suggested.

According to new estimates from Bloomberg, Nokia's second quarter shipments are likely to be down 14%, pushing the firm to a second quarter loss of €48 million.

The analysts also believe Nokia, which remains the largest mobile phone manufacturer in the world in terms of sales, could potentially lose a further €192 million in the third quarter.

Speaking to the news agency, Bert Nordberg, CEO of Sony Ericsson Mobile Communications said that Nokia was suffering from "collapsing" global sales for low and mid-range feature phones. This is due to the fact that many consumers are turning to low-end smartphones, often powered by Android.

Figures released by Gartner in April show that 22% of the smartphones sold around the world in 2010 were powered by Google's mobile operating system. Symbian, Nokia's operating system, powered 38%.

But Gartner predicted that Android will have a market share of 39% for 2011, with Symbian well behind on 19%.

Nokia is also facing falling fortunes in key emerging markets. According to Gartner, the company's market share fell from 32% to 20% in China - and from 49% to 30% in India - between 2009 and 2010.

But Asia remains a priority market for the mobile phone manufacturer going forward.

Nokia executive vice president Colin Giles told Bloomberg last month: "[Asia is] a hugely important market for us.

"We introduced our first phone specially designed for the Asian market 14 years ago. It was small, had a full graphics display and featured many Asian languages from Chinese to Thai to Bahasa. We have not looked back since."

The firm has also recently launched a new suite of smartphones, and has announced plans to switch its Symbian operating system to Microsoft's Windows Phone service. This follows its signing of a strategic partnership with Microsoft in late 2010.

Data sourced from Bloomberg/Cnet/Warc; additional content by Warc staff