Nokia Credit Rating Cut to "Junk" Status by Fitch
April 24, 2012 11:44 AM
comment(s) - last by
Nokia credit rating downgraded by a third firm
You certainly don't have to be an analyst to understand that Nokia is sailing through rough waters. The mobile phone company is still one of the largest phone shippers in the world, but devices it ships tend to be low-profit mainstream handsets rather than high-end and profitable smartphones.
Nokia has recently had some success with its
, but that modest win isn't enough to turn around its fortunes.
This week, Fitch Ratings downgraded Nokia's credit rating to junk status. Fitch also said that the outlook for Nokia remained negative as market share continues to shrink. Fitch isn't the first to downgrade Nokia's credit rating either; the phone company has been downgraded by Standard & Poor's and Moody's as well. Nokia's ratings could be lowered even further if the company doesn't improve in Q2 2012 and beyond.
"Given the potential headwinds facing the company, Fitch is currently not convinced that Nokia can attain this over the course of 18 months," it said in a statement.
reports that Nokia issued a statement showing its cash position at $6.4 billion as of the end of March. Apparently, that was an attempt to show investors and analysts that the company is sitting on a cash stockpile despite poor market share.
"Nokia will continue to increase its focus on lowering the company's cost structure, improving cash flow and maintaining a strong financial position," Chief Financial Officer Timo Ihamuotila said.
Fitch believes that that cash reserve Nokia has right now could be completely depleted over the next 18 months thanks restructuring charges and negative cash flow. Nokia is taking a battering in the smartphone market because it has been unable to compete with high-end offerings from Apple and the hoards of Android smartphones available.
Nokia has hopes of turning around with this new smartphones such as the Lumia 900 on AT&T and other new devices coming this year.
This article is over a month old, voting and posting comments is disabled
RE: Convince dump, buy, then pump.
4/25/2012 8:03:15 AM
Sold out at a price of free with 2 year contract. HP sold a ton of tablets when they slashed their price.
"DailyTech is the best kept secret on the Internet." -- Larry Barber
Windows Phone's First Hit: Nokia Lumia 900 LTE Sells Out
April 17, 2012, 12:16 PM
Microsoft Admits Lumia 925 and 1020 Have Sleeping Sickness, Bug Fix is Planned
November 24, 2014, 1:12 PM
Report: Samsung Galaxy S5 Sales Have Come in 40% Below Projections
November 24, 2014, 6:58 AM
Quick Note: Google Chromebooks Now Coming with 1TB of Google Drive Space
November 21, 2014, 1:20 PM
Xiaomi Aims to be #1 Smartphone OEM Within 10 Years, Apple Urges Caution
November 21, 2014, 9:33 AM
Quick Note: Samsung's Request to Dismiss Microsoft Lawsuit is Rejected
November 20, 2014, 12:53 PM
Amazon Offers "The Washington Post" Free for Six Months to Kindle Fire Owners
November 20, 2014, 7:41 AM
Most Popular Articles
Wal-Mart: Miss Thanksgiving, Get Xbox One + Master Chief Collection for $299
November 17, 2014, 9:40 PM
Nokia Lumia 635 LTE Windows Phone is Only $40 at Best Buy on Black Friday
November 18, 2014, 11:59 AM
Uber Exec Threatens to "Spend Millions" to Stalk Female Reporter and Her Family
November 19, 2014, 12:31 PM
Toyota’s Mirai Hydrogen Fuel Cell Vehicle Priced from $57,500 in the U.S.
November 18, 2014, 10:23 AM
Apple Replaces “FREE” Label with “GET” on App Downloads in iTunes App Store
November 19, 2014, 5:38 PM
Latest Blog Posts
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information