Nokia (NYSE:NOK) CEO Olli-Pekka Kallasvuo deflected criticism from shareholders of his management of the company, and promised to improve the Nokia's performance in smartphones against the likes of Apple (NASDAQ:AAPL) and Research In Motion (NASDAQ:RIMM).
The Nokia chief, who has been at the helm since 2006, has come under increasing pressure from shareholders and analysts to deliver a compelling answer to Apple's iPhone. At the company's annual general meeting he received support from Nokia's board for his efforts to transform Nokia into a services-oriented company.
While Nokia continues to lead in terms of global smartphone market share, it has been upstaged by Apple as well as smaller handset vendors making phones running on Google's Android platform that have crowded into the market. Last year Nokia's revenue slumped 19 percent and operating profit dropped 76 percent. In a further blow, Nokia came in at No. 43 in a brand-ranking study released recently by marketing research firm by Millward Brown, falling 30 places in a year.
"The numbers are shocking; the sales fall, the operating profit crash," shareholder Pekka Jaakkola told Reuters at the meeting. "I wouldn't say operating profit was catastrophic, but the direction clearly was."
In response to the concerns, Kallasvuo said Nokia will release smartphones this year that will "help close the gap" with its rivals, though he offered few details. The company will begin shipping its first phones running Symbian^3 in the third quarter, and plans to release a device running MeeGo--the software that combines Intel's Moblin efforts with Nokia's Maemo platform--by the end of the year.
"We are working hard to reclaim leadership in high-end smartphones and mobile computers," he said at the meeting, according to Bloomberg. "It's critical that we improve the customer experience with the usability of both our devices and our services."
Still, analysts and shareholders worried that the company's efforts to catch up may not be enough. "The high-end user they've lost to the iPhone has signed up for iTunes and put their information on Apple; Nokia won't get them back or not without an enormous amount of pain," Stuart O'Gorman of Henderson Investors told Bloomberg. "You have to run so fast to stay still in this market. It may be too late."
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