Will the Apple Settlement Keep Nokia Afloat?
Struggling Finnish phone-maker Nokia (NYSE:NOK) has endured a tumult of financial woes in recent weeks that have sent stock prices for the company on a tailspin. Trading at highs of nearly $12 a share in February, the stock has plummeted over the last three months, shedding roughly 50% of its value at today’s price of $5.97. The former world’s leading phone-maker has reeled on news of seriously down-graded earnings revisions, weak future sales projections, departing management, and reports that its smart-phones are getting hammered in sales by competitor’s products such as Apple (NASDAQ:AAPL) iPhones, Google (NASDAQ:GOOG) Android OS phones, and Research in Motion (NASDAQ:RIMM) Blackberry’s.
Nokia (NYSE:NOK) finally received some good news yesterday as reports revealed that the company will receive a large sum of cash from rival Apple (NASDAQ:AAPL) to settle a patent dispute between the two firms. Nokia will receive a $715 lump sum payment up front and an additional $200 million in cash scattered over the rest of the year. The news may be significant enough to impact Nokia’s flailing balance sheets, as one analyst projects that the influx of cash could boost the company’s quarterly EPS by as much as $.02 per share.