Nokia to shift turnaround by 2015 in market
It’s no secret that Nokia has met challenging times recently and is making concerted efforts to regain ground in the mobile phone market. The company has put its all behind the Windows Phone OS and its recently launched Lumia phones were the hope of a big revival but have met mixed success. However it now seems that Nokia has a chance to see a turnaround by 2015.
Once at the top of the mobile phone tree with 41% of the market Nokia now only commands a 19.1% share of the market and is behind Samsung in phone sales. Former Microsoft executive Stephen Elop was brought to Nokia and the Symbian OS headed to retirement in a bid to rejuvenate its smartphones by using the Windows Phone OS. However although some of the new Lumia range of smartphones received some critical praise, problems on launch (for example with the Lumia 900) impacted on sales.
However this hasn’t yet deterred Nokia and the company recently announced plans to jump into the tablet market with a Windows 8 device. Along with that it still produces some Symbian handsets for the lower-end of the phone market . An interesting article on Seek Alpha tells how the continuing production of Symbian phones from Nokia is possibly an attempt by the company to bridge its markets while making a gradual switchover to the Windows Phone OS, which does seem to make sense.
There’s also an encouraging sign with the news that the Windows Phone platform that Nokia has adopted now accounts for between 3 and 6% of the developed market. Furthermore the article also tells how maybe things aren’t so bad for Nokia as many have thought and suggests that Nokia is currently undervalued. The report goes on to say that future projections involving the market share of Windows Phone devices, if accurate, could mean that Nokia’s share price could double over a year and triple within 18 months, signifying a real turnaround for Nokia.
Plus points for Nokia include the fact that the plans for its Windows Phone future are firmly established, new innovations such as Nokia Reading, a strong supply chain and a favorable gross profit margin. It also remains steadfast in the Enterprise market and as well as that is investing in cloud services so it does seem as though Nokia is making a concerted effort not to be left behind for a second time. One area that Nokia could make big improvement upon is the time it takes to get products to the market though.
All of the above plus points are reasons that the Seek Alpha report believes current investors buying Nokia could well triple their investment over the next two years. We’d be interested to hear your views on this. Do you think the Seek Alpha report is overly optimistic and that Nokia will still be floundering by 2015? Maybe you agree that Nokia is currently undervalued and that future progress will be made?