Windows Phone Might Not Help Nokia, Analyst Believes

Windows Phone, the latest mobile operating system from Redmond-based Microsoft, is expected to gain a lot of market share in the next few years, greatly helped by the popularity Nokia's smartphones running under it would have, analysts believe.

However, it seems that Windows Phone might not prove as helpful to Nokia as the company might have hoped when adopting it as its primary mobile operating system.

Recently, Bernstein Research analyst Pierre Ferragu said that Nokia would be impacted severely in the next few months, and that its shares would go down even more than initially previsioned.

Ferragu notes that Nokia's stock is expected to hit the $4 mark, almost half of the initially expected $7.33.

“In a fast changing market, Nokia is losing ground very rapidly,” the analyst stated, a recent article on BGR reads.

“The profit warning for the second quarter provided evidence that the next couple of years will prove very challenging, with the gross margin and market share trends of the last 4 quarters continuing, if not accelerating even more,” he continues.

“The collaboration with Microsoft now appears to us unlikely to be successful, as Nokia’s brand is losing ground too fast and the window of opportunity for an alternative ecosystem is vanishing rapidly.

"Even modeling a scenario in which Nokia stabilizes next year leads us to believe that the stock will under-perform over the next twelve months.”

During the second half of the ongoing year, Nokia is expected to lose almost half of its market share in the smartphone segment area, when compared to the same time frame a year ago.

The company would enjoy only 19 percent of the smartphone market at the end of the three months period, although it accounted for 38 percent of the market last year.

The overall mobile phone market share would be lower as well, down to only 30 percent, compared to the 35 percent Nokia accounted for a year ago.