Investors sue Nokia over 2008 production delays
It’s always best to know all the required information before investing money to a company – so that an informed decision can be made. Unfortunately for Nokia, the world’s biggest maker of mobile phones, they’re being sued by investors who claim that the company hid production delays in 2008. Why is this huge outrage? Well it could also be the fact that phone prices and operating margins declined afterwards. The lawsuit is being brought on behalf of buyers of Nokia’s American depository receipts and state that Nokia became aware of production delays with its mid-priced phones. Investors also cited that Nokia “hid this fact from investors and instead highlighted the company’s expected launch of several new phones.” Amidst increased competition, the company began reducing prices, combined with the production delays, eventually cut operating margins to 18.6 percent in 2008’s third quarter from 21.2 percent in that year’s first quarter. Laurie Armstrong, a spokeswoman for Nokia, said that she was looking into the suit and didn’t have an immediate comment.
source: Business Week
source: Business Week
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