Nokia investors tell CEO to rethink Microsoft ties
The road to hell
Nokia CEO Stephen Elop has come under fire from investors as the company struggles to turn its fortunes around.
At the mobile giant’s Annual General Meeting in Helsinki, shareholders voiced their frustrations at the decisions Elop has made, as well as his refusal to back down.
In particular, his decision to abandon the original Symbian operating system in favour of Windows Phone was criticised, with many urging Elop to reconsider. Reuters quotes shareholder Hannu Virtanen as saying:
“You’re a nice guy … and the leadership team is doing its best, but clearly, it’s not enough. Are you aware that results are what matter? The road to hell is paved with good intentions. Please switch to another road.”
Criticism is fierce in the wake of Nokia shares tumbling 13 per cent to £2.30, after poor Q1 results. Despite sales of the Lumia handset rising an impressive 27 per cent, total sales revenue declined by 20 per cent, resulting in a loss of £290m. The Lumia’s rising popularity has not been sufficient to win back smartphone market share from Apple or Samsung.
In response to the AGM grilling, Elop stood firm by the Windows Phone OS, promising this “clear decision” would eventually bear fruit.
Out of the frying pan…
Elop’s decision to exclusively adopt the relatively new Windows Phone operating system was seen as a turning point for the company in 2011. He infamously issued a memo in February 2011 comparing Nokia to a burning oil platform, with the difficult decision to stay and burn, or change and face other dangers. The Windows Phone deal was announced a few days later. Elop became CEO in September 2010, tasked with turning around the company’s decline, having formerly worked as head of Microsoft’s business division.
Kleon West, business development director at theEword, said: “Any company attempting to square up to Apple and Samsung is going to have their work cut out, and unfortunately Nokia made a few mistakes that have slowed it down. Of course, the support and confidence of shareholders is absolutely vital, so Elop will have to work hard to prove he has made the right decision.”