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Nokia has big write down coming in light of Windows Phone 8 launch

Posted: , by Alan F.

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Nokia has big write down coming in light of Windows Phone 8 launch
As if Nokia didn't have enough reasons for stockholders to dump the stock, the Finnish based handset manufacturer might have to write down perhaps hundreds of thousands of Nokia Lumia handsets which the company will have trouble selling with the impending Windows Phone 8 launch. Nokia has also reduced orders to ODM Compal Communications for the Nokia Lumia handsets, which helped Compal's revenues drop 39.5% sequentially in June.

The Nokia Lumia 800

The Nokia Lumia 800

RDC Capital Analyst Mike Sue says he expects Nokia to write down Nokia Lumia units that won't sell with the more advanced Windows Phone 8 handsets soon to hit the stores. He sees the potential for Nokia to have to write down billions in inventory which should guarantee red ink on the company's bottom line for the entire year. Price cutting has worked well in the U.K. to stimulate sales as the Nokia Lumia has returned to iSwitch's Top Ten U.K. handsets in 8th place (above the 16GB Apple iPhone 4S and below the HTC One S). It was the phone's first appearance on the list since February.

Microsoft has already announced that existing Windows Phone models will not be updated to Windows Phone 8. The new OS will enable manufacturers to offer handsets powered by multi-core processors, higher resolution screens (720p) and microSD slots to name a few. Microsoft's updated mobile OS will allow phones running the software to better compete with Android models that now offer quad-core processors, HD displays and expandable memory.

Unsold inventory of Nokia Lumia phones could end up sold at extremely low prices, given away as an enticement to sign up for a specific data plan, sold to third party discounters or simply destroyed. Any revenue Nokia receives from selling the phones after a write off would be like found money as far as the company is concerned. Writing off such a large amount of handsets is often seen by investors as a bottom which is why shares sometimes soar on such news.

source: WMPoweruser

23 Comments
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posted on 11 Jul 2012, 18:44 7

1. djripster (Posts: 118; Member since: 10 Dec 2011)


I wouldn't mind getting a free Lumia 900, why waste your stock Nokia :)

posted on 12 Jul 2012, 01:31 1

15. Droid_X_Doug (Posts: 5495; Member since: 22 Dec 2010)


Magic 8 Ball says a Lumia BOGO for $0.01 USD promo is in the offing - SOON....

posted on 11 Jul 2012, 19:00 6

2. alinda (Posts: 1; Member since: 11 Jul 2012)


I want a free Lumia 900, gimme gimme!!

posted on 11 Jul 2012, 19:08 6

3. Joshing4fun (Posts: 1043; Member since: 13 Aug 2010)


They should turn that extra stock into some sort of promo. Make lemonade Nokia!

posted on 11 Jul 2012, 19:23 3

4. andyboi_ph (Posts: 101; Member since: 26 Mar 2012)


or when they cut-off the prices of existing LUMIA big-time, I might get one, the 800 or 900 model, i wouldn't mind using 7.8 version though

posted on 11 Jul 2012, 19:29 3

5. azafirster (Posts: 41; Member since: 01 May 2012)


There you have it, CEO's nitwit decision to not give os upgrade to current phone litterally kills old stock.

posted on 11 Jul 2012, 22:34 3

10. harley22x (Posts: 9; Member since: 11 Jul 2012)


The Lumia IS getting 7.8.... Apple does the same thing, and Android does with many phones. The old phones can't grow another processor core, or a high resolution screen, NFC technology, or an SD Card slot. Correct me if I am wrong, but I am pretty sure phones of today do not have those capabilities. So why have the full upgrade? 7.8 is most of the Software changes anyways, so what is the big deal?

posted on 12 Jul 2012, 00:02 3

14. Contreramanjaro (Posts: 153; Member since: 04 Dec 2011)


The only upgrade I'd really want from WP8 in WP7.8 besides what is already given is IE10. That being said I think the support Microsoft is giving to it's WP7 models is quite good. Android Phones many times only get a couple upgrades then they are no longer important enough for a company. iOS devices of a certain age seem to struggle with the newer OSs such as 3GS with iOS 5 or a iPod Touch gen 2 with iOS 4.3.

Also, people are entirely unaware of Windows Phone at all let alone the differences between 8 and 7.8. Go ask your typical iOS user which version of iOS they have and you, like me will get a blank stare followed by an "I don't know."

If Apple announced it, it would be "look at everything the old iPhone gets, Apple is so great. You get even more stuff if you buy new hardware!" I mean, clearly the iPhone 4 didn't have the power to run Siri... right guys? Right?

posted on 11 Jul 2012, 19:33 3

6. residualhatred (Posts: 25; Member since: 28 May 2012)


They need to send a few nokias to Virgin Mobile or one of the prepaid companies. There are few that would jump at a discounted lumia.

posted on 11 Jul 2012, 20:31 3

7. Mube1 (Posts: 153; Member since: 22 Sep 2011)


These feautres are already available on android last from 1 year, so what is new in window 8

posted on 11 Jul 2012, 22:38 1

12. harley22x (Posts: 9; Member since: 11 Jul 2012)


Tight integration with applications, plus live tiles man. come on. Also, it is smooth as ever. Jelly Bean is smooth, but face it, Jelly Bean will come available on like 4 handsets out now, and no others will be upgraded. Such as phones still on Android 2.3 like myself who don't even get ICS. (LG Optimus 3D). But anyways, Windows Phone is fast and smooth with high security features. Stuff android is crucially missing.

posted on 12 Jul 2012, 01:42 2

16. kanagadeepan (Posts: 628; Member since: 24 Jan 2012)


Empty truck is always faster than fully-loaded truck... Plz don't compare SINGLE-Tasking OS or FAKE-Multi-Tasking OS to Android in smoothness...

posted on 12 Jul 2012, 04:03

20. Stoli89 (Posts: 333; Member since: 28 Jun 2010)


You sound like a former Symbian fan bashing IOS.

posted on 12 Jul 2012, 06:55

21. harley22x (Posts: 9; Member since: 11 Jul 2012)


IOS is smooth as well. And android is finallly getting that fixed now. Your argument was completely invalid. But seriously, you would think that my phone, having a dual core, 512mb of dual channel memory with the latest update for my phone (2.3) it should be buttery smooth.... yeah, not the case. Android was having software problems with their smoothness, that is no question. Phones and tablets with quad cores were still lagging as well.

posted on 11 Jul 2012, 20:39 5

8. microsoftnokiawin (Posts: 867; Member since: 30 Mar 2012)


when will the board wake up and fire elop

posted on 11 Jul 2012, 21:46 2

9. plgladio (Posts: 311; Member since: 05 Dec 2011)


Microsoft's way to acquire a company. They are keep on winning, I like one kick from Nokia to kill the contract with MS.

posted on 11 Jul 2012, 22:35 1

11. harley22x (Posts: 9; Member since: 11 Jul 2012)


I would up and sell my LG Optimus 3D for a Lumia 900 any day.!

posted on 13 Jul 2012, 07:05

23. harley22x (Posts: 9; Member since: 11 Jul 2012)


I don't even use the 3D on the thing. I liked my HD7 better because all I do is watch videos, email and text. This is my opinion and I am getting dislikes? Lol bunch of apple fanboys or android fanboys... holy.

posted on 11 Jul 2012, 22:40 1

13. lubba (Posts: 1310; Member since: 17 Jan 2011)


Could have decent quarter. No, the phone people want have to be exclusive to ATT. Bad sales, bad marketing. Bad presentation. Not my problem. As long as HTC comes out with something hot for tmo this fall, I'm happy.

posted on 12 Jul 2012, 01:43 1

17. kanagadeepan (Posts: 628; Member since: 24 Jan 2012)


I also wan't one FREE Lumia900 WITHOUT a contract....

posted on 12 Jul 2012, 03:00 2

18. rizky_p (Posts: 19; Member since: 29 Oct 2011)


I remembered eloop said a multicore smartphone is a waste of battery life considering that one of the feature of WP 8 is multi core, not so smart now eloop?

posted on 12 Jul 2012, 04:00

19. Stoli89 (Posts: 333; Member since: 28 Jun 2010)


Where did this author get his information? Write down billions in stock? Do you really think Nokia, as an alliance partner to MSFT and clear visibility at the highest levels to the OS plan, would expose itself to such a write-down. Do you think Nokia has at least one supply chain planner in its entire company? Sure, Nokia may have reduced orders for current Lumia's in favor if replacing with the next wave of new products and yes, there will likely be a dip in the current sales trend during this transition...but to say that 7.8 Lumias will have no market around the globe is, well, BS.

posted on 12 Jul 2012, 14:25

22. Penny (Posts: 1073; Member since: 04 Feb 2011)


It also does not inspire much confidence when an article starts with "As if Nokia didn't have enough reasons for stockholders to dump the stock..." and ends with "...which is why shares sometimes soar on such news."

Make up your mind or drop one of the two statements (HINT: I'd drop the hook instead of the one you think is actually true).

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