With Apple and Samsung dominating the mobile market, there hasn’t been much room left for competition, including Nokia, the former market champion. Having struggled financially for some time, Nokia is now forced to make some tough decisions.
Since the release of the iPhone in 2007, the once-powerhouse has lost an estimated 90 percent of its stock market value. Things seem to keep getting worse for Nokia, and in the past year, it has spent about one-third of its cash reserves, leaving the firm with $5.79 billion as of October, putting it over quite the financial barrel.
The first major cut comes in the form of Nokia House, its glass and steel head office in Espoo, Finland (near Helsinki). The Associated Press reports that Nokia House will be sold to real estate investors for an estimated $273.6 million.
According to The Guardian, the company won’t be moving out of the building, but it will, instead, be staying on as a tenant.
Timo Ihamuotila, CFO at Nokia, is undiscouraged by this news; he told BGR, “We had a comprehensive sales process with both Finnish and foreign investors and we are very pleased with this outcome. As we have said before, owning real estate is not part of Nokia’s core business and when good opportunities arise, we are willing to exit these types of non-core assets.”
This is just one part of the company’s plan to save an estimated $2.58 billion by the end of 2013. The company has announced that they will be cutting 10,000 jobs.
Are these all signs that Nokia is on its way out for good in the near future? Not if the former cell phone giant has anything to say about it. Nokia is hopeful that the Lumia 920 and the Lumia 820 will turn the tides in its favor.