The earnings report for 2012 covered very little new ground that was not covered by Elop in his pre-announcement in early January. The result of that update was a revitalization of the upward movement.
I don't think any of us were looking for amazing results at that time and if you were following the Nokia program, the first quarter would be the first real test of what results they were having in marketing the Brand New Lumia 920, 820, 620 and the Asha Lines.
Personally I would have liked to have the dividend; however, most of the contributors to this board wanted to eliminate the dividend and keep the cash. No question, that I was out of the loop with respect to the dividend exclusion. Elop and the board comments made the right decision. The reality was that this represented a $900,000,000 (900 Million Dollar) distribution and since the demand in China outpaced the supply of the Nokia Smartphones having these dollars available for the solution to the supply problem made a lot more sense.
I watched the Microsoft Earnings Report yesterday afternoon and thought they did an outstanding job.
They showed some of the newer personal computers, laptops, Pads, and used the Nokia 920 as one of the newer methods of useing touch screens throughout their various products. They made it clear that there are 400,000,000 (Four Hundred Million) users of windows systems. Also, they pointed out that they have 40,000,000 licenses for the Windows 8 Software. Mentioned that they have 120,000 Apps for these various devices and this will only expand in the months and years ahead.
I don't hold any Microsoft Stock, being heavy in Nokia. If I had the loot would get on the Microsoft bandwagon. From what I saw yesterday the new touch layout will help the pc manufacturers in moving product and it would appear that the Windows Phone, Nokia and some others, will be a very important part of implementing the Windows 8 System. With approximately 80% market share with the Windows software, versus approximately 20% for Apple, there is certainly a huge potential for the Windows Phone as part of this ecosystem. Apple has done a great job over the years and some of the hits they have taken in the last few months might just be overdone. I feel the same hits to our favorite Nokia are also overdone; however, even if Apple gets back to the 600 plus area its percentage growth compared to Nokia with the real possibilty of going to 8 or 10 before the year is out and hopefully sooner does not compare.
Believe the Needham Positives will be a big help going forward and once some of the better analysts dig into the potential Nokia numbers especially for China and India, plus the many other countries that these fresh new products are just being introduced we will see more of these positive writeups. Keep in mind that the fourth quarter numbers are better understood when new products are being introduced, there is a tendency for the buyers to wait for the newer product, which was the case for Nokia. Stephen Elop made the point during the Earnings Conference call that the new 620 is being well received by China (Remember low end covered by Asha line, Mid Range by the 620, and the higher end with the 820 and 920) and their consumer response has been very positive and that other products and services will be coming in the months and years ahead. China Mobil, China Unicom Network, between them have One Billion Subscribers on their systems and this year alone China Mobil wants to move at least 100,000,000 (One Hundred Million) to Smartphones this year. I'm sure we will get a good share of these.
We should keep in mind that the Lumia phones are built very well. One of their demonstrations shows the unit being dropped, sawed, and the Gorilla Glass being hit by a hammer and surprisingly held up very well. I have no experience with the various competition products but I'm sure there is plenty of broken glass etc. when one of these is dropped and since a lot of us including myself tend to be Klutzes
these things do happen.
Nokia has superior picture taking capability, mapping, encryption, flexibility and use with other Windows 8 Devices, ease of use for software developers which will mean a greater number of useful Apps.
Steve Balmer at Microsoft mentioned that although some of the competition have more Apps. we have something like 47 of the top 50 Apps right now.
Take care and Good Luck to All of us.
Sentiment: Strong Buy
Nokia is in line with Chinese thinking. Chinese and Asians build things to last, while American cos if given the opportunity want to build things that fall apart so you have to keep buying new ones. Remember when the Japanese cars began to make a dent in the U.S. People didn't want cars that had to be replaced every few yrs, they wanted cars that lasted. Nokia builds phones that Last, Apple prefers it's users to keep buying new phones to replace the old phones, much like U.S. car manufacrurers wanted people to keep replacing their cars. That alone should establish Nokia in chinese minds as the phone to have, a Quality Phone built to last not to fall apart.
we must remember that Elop said they were still supply constrained. Which means demand is holding up well. He seemed to indicate that this is resolved with the new Viet Nam factory which comes on line this quarter. To me US analysts do not have access to good information in the rest of the world (especially emerging markets) and so don't know how to value NOK properly looking ahead. They are always looking at the last quarter not the next 2 or 3 quarters.
What is wrong with these jokers? Almost bankrupt and they decide to build a factory. This was last year when they were about to die. They took out bonds to finance this.
What kind of #$%$ do this kind stupid move? Did they not watch have Foxconn contract manufacture 40 million+ phones last quarter?
Really should a cash strapped company be building factories when the entire nation of china exists to contract manufacture consumer electronics.
Thank you! We all need to get grounded in reality and stop looking for the quick buck. These are real companies being invested in, not a trip to Vegas, Foxwood or Mohegan Sun. Fingers crossed for solid sales, reviews, customer satisfaction and market penetration over the next six months.
Sentiment: Strong Buy
Why would MSFT buy a company when they can pay a company to be their proxy in the phone business? If the Windows 8 phones don't work out, it will be Nokia that suffers most, not MSFT. If the W8 phones succeeds, then MSFT can offer it to other companies as well.
aledajm: There was a question at the end of the earnings report that went approximately as follows "About fifteen years ago, Bill Gates, who was there, held up a tablet Product indicating this is where the market is going. Of course, we never saw this product until the announcement recently on Microsoft's Pad product. How come?"
Balmer handled that question and basically said, at the time they were not in the hardware business and the manufacturers did not pick up on the idea. He followed by saying that if they were actually doing hardware as well, Bill's idea would have come to fruition a lot sooner.
I think Microsoft would like to do more of this, but they are faced with their customers for the Microsoft Products who might determine that MS was now a competitor and this might effect their sales of their Windows, Office and Excel and other products. This, of course, might change but what they are working on with Nokia is a better course, since they want to remain open to the other Smartphone operators in getting them to switch over to Windows 8. There is a major difference with the Phones however since these phone manufacturers are useing their own operating systems and this might open the possibility that they could buy a firm like Nokia.
With 3.8 Billion Shares Outstanding, the price at $10.00 would represent a 38 Billion Dollar Number. It certainly is a lot of money but well within the stash that they currently have on their Balance Sheet. I don't know how much overseas cash they have but this could be used for this type of acquisition.
The answer to your question has to be "I don't know"..
Sentiment: Strong Buy