Troubled corporate Nokia Corp. saw its share price plummet 14 percent on Wednesday after it warned that heavy competition will hit its first-quarter earnings, especially in developing markets, and that it expected no improvement in the second quarter.
The world's largest cell phone maker said multiple factors had hurt sales, particularly in the fast-growing markets of India, the Middle East and Africa and China.
The Finnish company has increasingly been losing out to competitors in the lucrative top-end smartphone sector, against Apple Inc.'s iPhone and brands using Google Inc.'s popular Android software, including Samsung. But it's also been squeezed in the low-end by Asian manufacturers making cheaper phones, such as China's ZTE.
Nokia said operating margins in the first quarter were "approximately negative 3 percent.'' Previously, it had expected them "around break-even, ranging either above or below by approximately 2 percentage points.''
It said it sold 71 million mobile phones in the quarter _ down from 108 million in 2011 - with net sales of (euro) 2.3 billion ($3 billion), while smartphone sales halved to 12 million units from a year earlier.
The profit warning was coupled by other bad news from the cell phone maker, which acknowledged a data connection problem with the Lumia 900 just two days after a high-profile launch in Times Square in New York and elsewhere in the United States.
Nokia said it would compensate American Lumia 900 users with $100 in credit at AT&T because of the software problem, as well as providing an updated Lumia 900.
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