Moody’s, a large rating agency, has just reduced Nokia’s financial rating, and maintaining a negative outlook (as in: it will become worse).
As a reply, Nokia has now sent out the following press release. As always, highlighting is added by yours truly:
Nokia notes today’s announcement from Moody’s, reaffirming its investment grade credit rating. Earlier today Moody’s downgraded Nokia’s long-term credit rating to Baa3 and maintained the negative outlook on the rating. Moody’s stated that its investment grade rating is backed by Nokia’s strong liquidity position and capital structure.
Nokia’s financial position remains strong. As of March 31 2012, Nokia had gross cash balances of EUR 9.8 billion, and a net cash position of EUR 4.9 billion.
Cash conservation remains a priority for Nokia in the current transition. We are making progress with our previously announced targets to reduce non-IFRS operating expenses by more than EUR 1 billion in Devices & Services, and to reduce non-IFRS operating expenses and production overheads by EUR 1 billion in Nokia Siemens Networks.
“Nokia is quickly taking action. Nokia will continue to increase its focus on lowering the company’s cost structure, improving cash flow and maintaining a strong financial position,” said Timo Ihamuotila, Nokia’ Executive Vice President and CFO.
Nokia will report its first quarter 2012 results on April 19, 2012.
Let’s put this crystal clear: your company is loosing market share due to unwanted handsets and bad management, and all you do is reduce the prices and be more effective? To me, this sounds a lot like a plane heading into a mountain – if Nokia would be piloting it, they would probably slow down rather than climb.
Of course, Microsoft has an almost unlimited amount of money to keep the N folks alive – but is this really what Nokia’s future should be?
What do you think?