Nokia has been downgraded by another ratings agency, with Standard & Poor's (S&P) claiming the manufacturer faces further losses and declining sales.
The Finnish manufacturer dismissed the downgrade, saying it would have a 'limited' impact. However, Nokia has also been downgraded by the Fitch and Moody's rating agencies in the past month.
S&P said Nokia would sell fewer smartphones in the coming quarters than it previously predicted. It added that the Finnish manufacturer's market share continues to decline and Lumia purchases are not matching the drop in Symbian sales.
S&P said it expects Nokia to cut the price of the Lumia portfolio in the coming quarters, adding: 'We expect Nokia to launch new models, notably those based on the Windows Phone 8 operating system, but we think it could take some time before this can help stabilise revenues.'
S&P predicted that consolidated revenues for the 2012 calendar year would be down 16-19% on 2011. It also projected a loss before restructuring costs. While S&P noted a positive in Nokia's cash flow, it said its position will weaken to less than €3bn by the end of this year, from the €4.2bn it revealed on 30 June.
Responding to the downgrade, Nokia executive VP and CFO Timo Ihamuotila said: 'The impact of Standard & Poor's decision on the company is limited. As we continue our transition, we are applying a strong focus on cash conservation while simultaneously reducing our operating costs and making our operating model stronger and more agile.'
He added that Nokia had access to additional borrowing facility of €1.5bn, which it had not drawn.
Editor: Graeme Neill