Nokia set for fresh smartphone pain
Nokia set for fresh smartphone pain
Nokia's share price has halved since February - when it unveiled the shift to Microsoft.

Helsinki: Investors braced for more bleak news from smartphone laggard Nokia Oyj on Thursday with the world's largest handset maker likely to post a second-quarter loss and a weak outlook.

Nokia is due to report second quarter earnings at 1000 GMT (6 pm ET).

The Finnish company created the smartphone market in 1996 with its first Communicator model but has failed in recent years to mount a serious challenge to the surge from Apple Inc's iPhone and Research In Motion's BlackBerry.

On Tuesday Apple reported forecast-beating earnings while Sony Ericsson and HTC have also signaled strong smartphone demand.

Nokia Chief Executive Stephen Elop has been pinning turnaround hopes on new smartphones using Microsoft software, but these will only come to market later this year.

Nokia's share price has halved since February - when it unveiled the shift to Microsoft - on worries the company will lose so much market share before the new phones come out that it might never recover its footing.

In May, Nokia said second-quarter results would be well below its previous outlook and ditched full-year targets.

To hold on to customers, Nokia has slashed the prices of its old smartphone line-up from the start of the third quarter, a move which is expected to weigh on margins.

Smartphone troubles are expected to drag Nokia to a second quarter underlying net loss of 10 million euros ($14.2 million) from a 419 million profit a year ago, according to the average forecast in the Reuters poll of 27 analysts.

Analysts' estimates vary widely in part due to a one-off royalty payment from Apple. Some expect a payment of up to $650 million from a legal battle settled in June, while others see much smaller income.

Nokia has said also Microsoft would pay it billions under the smartphone deal, but it is unclear whether any portion of that would be included in the second quarter.

The company is also due to book a large restructuring charge for job cuts in its phone business. It could also announce additional job cuts at its telecom gear arm Nokia Siemens Networks.

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