Nokia Misery Continues With Departure and Downgrade
The woes of Nokia, the world’s largest phone maker, took another turn Thursday with the departure of a key executive and further falls in its share price.
Nokia's chief technology officer Richard Green has taken a leave of absence and is unlikely to return after disagreements over the strategy of the struggling mobile phone company.
Nokia confirmed that Green had left and said that Henry Tirri, head of Nokia Research Center, will be the acting CTO.
Analysts at HSBC slashed the mobile phone manufacturer’s price target to 4.40 euro ($6.44) from 6.50 euro and rated it underweight on Thursday morning.
Its debt has already been downgraded to one notch above junk status by Fitch, the credit rating agency, earlier in the week.
Last month, Nokia had to issue its second profit warning this year after disappointing sales.
The Finnish giant is close to losing its position at the top of the phone market, which once seemed almost unassailable. It has been challenged by new smartphones such as Apple’s
iPhone and Google’s Android devices and cheaper Asian rivals at the cheaper end of the market.
Chief Executive Stephen Elop has said the company will regain market share through a deal combining Microsoft software with its own Symbian platform.
Stuart Reid, head of Fitch’s technology team in London, said the agency had “serious concerns” over Nokia’s declining market share.
“It appears consumers are deserting these legacy [Symbian] handsets for cheaper Android versions or high-end Android or Apple smartphones,” Mr Reid said.
“Moreover the execution risk around the successful launch of a new Windows-based product suite against highly competitive and established players such as Samsung, HTC and Apple has now greatly increased.”