NOK) shares were hammered today (Wednesday) after the company announced its continued smartphone market struggles would weigh on profits in 2012.
Nokia, the world's largest maker of cellphones by volume, warned that mobile phone sales will be weaker than forecast in the first quarter due to strong competition in fast-growing markets. After previously thinking it would break even, Nokia now predicts a 3% loss.
The word of warning highlights the steep challenges the Finnish cellphone maker faces in attempts to bolster its smartphone lineup. Cellphone devices and services account for up to 60% of Nokia's sales.
The latest lowered profit forecast is the second in less than a year, and the note of caution sent shares of Nokia plummeting to a 15-year low. Nokia last warned of falling profits in May 2011 due to its weak and diminishing presence in the ever-growing, highly contested smartphone market.
Now the company needs to figure out how to compete with the raging popularity of Apple Inc.'s (NASDAQ: AAPL) iPhone, while fending off competition among lower-end smartphone models running Google Inc.'s (NASDAQ: GOOG) Android operating system.
Nokia (NYSE: NOK)
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