Nokia had its debt downgraded by the ratings agency, Fitch Ratings. Fitch downgraded Nokia's Long-term Issuer Default rating to "negative" from "stable" based on a weaker projected handset market in 2009, weaker cash flow and less financial flexibility for the Finnish firm.
Fitch also viewed Nokia's handset business, its core operation, as having weaker growth than its network equipment business. That said, Nokia still remains an industry giant, but one that will probably see smaller margins in 2009. The news comes on the heels of drastic price-cutting measures taken by Motorola and as the handset market as a whole braces for a slump in 2009.
Earlier this month Nokia reaffirmed its profit and growth warnings for the fourth quarter of 2008 and into 2009, cutting its outlook for global handset sales.
"2009 will be challenging for our industry, however we have a strong, enviable base to build on and I believe we will continue to strengthen our position on many fronts," Nokia CEO Olli-Pekka Kallasvuo said in a statement at the time.
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