Nokia has issued its second profit warning this year ahead of the release of its Q2 results in July.
The company today (31 May) commented on factors impacting its business and updated its second quarter and full year 2011 outlook. It will report its second quarter results on July 21, 2011.
Nokia said it had been affected by the ‘competitive dynamics and market trends across multiple price categories’; a product mix shift towards devices with lower average selling prices and lower gross margins; and ‘pricing tactics by Nokia and certain competitors’.
Nokia now expects its net sales to be ‘substantially below’ its previously expected range of 6.1bn to €6.6bn for the second quarter 2011. This update is primarily due to lower than previously expected average selling prices and mobile device volumes.
The company said it is taking ‘immediate action’ to address the issues that are impacting its business.
It has taken ‘price actions' on its current smartphone portfolio, and is intensifying its focus on retail point-of-sales marketing.
Nokia started shipping its new dual-Sim devices last week and is due to ship its first Windows phone in Q4 this year.
Nokia CEO Stephen Elop (pictured) said: ‘Strategy transitions are difficult. We recognise the need to deliver great mobile products, and therefore we must accelerate the pace of our transition. Our teams are aligned, and we have increased confidence that we will ship our first Nokia product with Windows Phone in the fourth quarter 2011.’