Nokia (NOK) Mounts Strategic Turnaround; Is Open to Selling Patents, Likes China Numbers
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Following reports that Nokia (NYSE: NOK) was in serious talks for the sale of its Vertu luxury phone unit, Thursday finds us with more Nokia news than you can shake a club at.
The Espoo, Finland-based mobile device giant affirmed the sale of Vertu, simply retaining a 10 percent stake in the process. Financial terms of the deal were not disclosed.
Further, Nokia announced plans for corporate streamlining and redirection of resources to more profitable ventures. Briefly, Nokia will be reducing its footprint with the closure of two facilities in Germany and Canada, a manufacturing facility in Finland (though R&D will continue there), focusing marketing efforts in key markets, and possible divestment of assets (including the Vertu deal mentioned above). The moves will lead to 10,000 job cuts worldwide, expected to be completed by the end of 2013.
With all that in consideration, Nokia plans to save €1.6 billion by the end of 2013.
Marketing chief Jerri DeVard also got the boot, along with several other key marketing and mobile device executives.
Also of note, the company announced it acquired long time imaging device application partner Scalado AB. Terms of that deal weren't disclosed.
The best part is Nokia issuing yet another update on its Devices & Services outlook. The company sees more pressure on the segment in the third-quarter and expects second-quarter operating margins to come in below the negative 3 percent level reported in the first quarter. Nokia pulled the same move ahead of its first-quarter report, sending shares plummeting lower.
Where's the focus then? Well, Nokia said it would like to continue development of its Series 30 and Series 40 devices, improve its location-based platform, and "invest in key feature phone technologies like the Nokia Browser."
Some headlines from the conference call Thursday morning, from CEO Steven Elop and CFO Timo Ihamuotila:
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The Espoo, Finland-based mobile device giant affirmed the sale of Vertu, simply retaining a 10 percent stake in the process. Financial terms of the deal were not disclosed.
Further, Nokia announced plans for corporate streamlining and redirection of resources to more profitable ventures. Briefly, Nokia will be reducing its footprint with the closure of two facilities in Germany and Canada, a manufacturing facility in Finland (though R&D will continue there), focusing marketing efforts in key markets, and possible divestment of assets (including the Vertu deal mentioned above). The moves will lead to 10,000 job cuts worldwide, expected to be completed by the end of 2013.
With all that in consideration, Nokia plans to save €1.6 billion by the end of 2013.
Marketing chief Jerri DeVard also got the boot, along with several other key marketing and mobile device executives.
Also of note, the company announced it acquired long time imaging device application partner Scalado AB. Terms of that deal weren't disclosed.
The best part is Nokia issuing yet another update on its Devices & Services outlook. The company sees more pressure on the segment in the third-quarter and expects second-quarter operating margins to come in below the negative 3 percent level reported in the first quarter. Nokia pulled the same move ahead of its first-quarter report, sending shares plummeting lower.
Where's the focus then? Well, Nokia said it would like to continue development of its Series 30 and Series 40 devices, improve its location-based platform, and "invest in key feature phone technologies like the Nokia Browser."
Some headlines from the conference call Thursday morning, from CEO Steven Elop and CFO Timo Ihamuotila:
- Pleased about what's happening in China;
- May sell some patents, but at the right price.
- New Lumia prices will be below that of the Lumia 610;
- Feature phone business needs to improve. Nokia plans to continue taking market share in the feature phone segment;
- Windows 8 creates opportunity to tap business customers;
- Microsoft (Nasdaq: MSFT) is relying on Nokia for location-based services;
- Nokia says location-based services are much better than peers; and
- Resources are ample to manage the transition.
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