Nokia’s Current Turnaround “Historical” ?


chart turnaround

According to the Motley Fool (a well respected market watch site) “Nokia is a historical turnaround in the making”.  You heard that right in fact in the last 12 months Nokia’s stock has gone up an astounding 135%!  Despite the doom and gloom you hear from some mainstream tech sites there are good reasons for this 52 week turnaround of fortune.

The main reason on the mobile side is the commitment from Nokia to hit all price points with their Windows Phone device to serve emerging markets.  The Nokia Lumia 520 has made huge inroads in budget conscious countries like South Africa, India, etc…  Even in markets like the United States the 521 is bringing in first time smartphone buyers to the Windows Phone ecosystem.  This is extremely important as Windows Phone is trying to solidify it’s place as the 3rd ecosystem over Blackberry.  While Blackberry has been making small comeback in phone sales with the release of their new devices and OS Nokia is still selling more Lumia devices themselves than all Blackberry devices combined.


Nokia sold 7.4 million Lumia devices last quarter.  While this was slightly short of the 8 million units analysts where expecting it’s still a 32% increase quarter over quarter.

Nokia also will be gaining another profitable business when they fully take over the the Nokia Siemens Network later this year.  While this company is not quite the money tree it use to be it is still a very profitable business it still has a 12% increase in adjusted operating margin this 2nd qtr this year over 2nd qtr 2012.  Plus the company is expected to get lots of work from the expanding networks in Asia.  The cornerstone of these projects is expected to be a massive build out by China Mobile of their 4G TD-LTE network.

It’s not all roses for Nokia however the feature phone market is starting to fall away from Nokia with them losing a full 25% of their feature phone sales year over year.  This is expected to be offset by patent agreements and the steady uptick of Lumia devices sales.  It is thought that Windows Phone has reached a “tipping point” in the market place where it is now accepted as a true opinion when people go smartphone shopping.  This point is a point where everyone knows about the operating system and most likely knows a few people personally using Windows Phone.  Friends or Family using a device/OS weights heavily on most consumers purchasing decisions.

I’d like to believe that Nokia is out of the woods and it’s all sunshine and flowers however the next few quarters will still be very important to Nokia’s future and Nokia’s future looks much brighter now than it did in a long time.