What Is the Impact on Nokias Margins From Smartphones?

Trefis submits:
Rising competition in the handset market, lower phone prices, and rising R&D expenses have chipped away at Nokia’s (NOK) profit margins in recent years. Nokia competes with Research in Motion (RIMM), Apple (AAPL), Motorola (MOT), Samsung (SSNLF.PK) and Google’s (GOOG) Android devices in the smartphone segment and a host of players in the basic handset business. From 2007 to 2009, Nokia’s EBIT margin (a measure for profitability) for mobile phones declined from 20% to around 13% on a firm wide basis.[1] We expect this trend to continue over our forecast period, slipping to around 7.5% by 2016. However several items might turn margins around including new initiatives like its online app store called Ovi, an upgraded operating system (OS) and its push into smartphones.Complete Story »


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