IDC Comment on Third Quarter 2011 Nokia Results

Nokia Suffers an Outage on Results in the Third Quarter 2011.

Nokia results announced today show how painful the transition from Symbian to Windows Phones has been. Despite the investment in making Symbian more attractive and user friendly, the new Symbian Anna and Symbian Belle are not helping Nokia in any way. Smartphone shipments are down 38% year on year. Consumers and mobile operators are looking forward to seeing the new Windows Phones. For most mobile operators in Europe, it is completely pointless to support a "ghost" operating system; they want Windows Phones, and that is what Nokia needs to deliver next week at Nokia World in London. Failing to deliver the Windows Phones this year puts Nokia in a very dangerous position in the market.

Nevertheless, the results were above expectations, as Nokia managed to grow shipments in the feature phones segment. Volumes were up 8% year on year and 25% sequentially. This helped Nokia to grow its market share in the segment. The success of its DUAL SIM portfolio has proven attractive to consumers in Asia Pacific, particularly in India, a strong DUAL SIM market. But this came at a cost — the average selling price (ASP) of feature phones was down 20%.

Overall, the results were better than expected, considering the difficult strategy shift that Nokia took early this year. Nokia's smartphone market share is expected to decline this quarter to 15% from 17% in 3Q10, maintaining its position as the third biggest smartphone player in the world. The company's feature phone market share is expected to be 36%, up from 32% in the third quarter of 2010. IDC estimates that Nokia remains the biggest manufacturer in the world with a 29% market share in 3Q11, down from 32% in 3Q10.