Nokia Investors Get Impatient, Revolt Against CEO


Stephen Elop, Nokia CEO, came under heavy fire on Tuesday when investors expressed their discontent with his attempts at catching up with smartphone leaders, Apple and Samsung. At the AGM in Helsinki, shareholders suggested that Elop should reconsider the decision to switch to Microsoft’s mobile operating system. The move has caused Nokia to fall from smartphone race. “You’re a nice guy and the leadership team is doing its best, but clearly, it’s not enough,” Hannu Virtanen, a shareholder, told Elop. “Are you aware that results are what matter? The road to hell is paved with good intentions. Please switch to another road,” he said.

Two years have since passed since Nokia decided to change from Symbian to Windows Mobile. The results? Growth in the sales of Lumia smartphones, a Windows Phone 8 device. The volumes however don’t come close to top Samsung and Apple models. Sales of other Nokia phones have also plunged over time, and the company isn’t doing any better with its share price which now trade at 2.72 euros. This is a pale shadow to their peak of 65-euro in 2000.

Inspite of the company’s dismal financial performance and a suspension of annual dividends, older shareholders still hold on to their stake in Nokia. According to them, this is for sentimental reasons as Nokia symbolises Finland’s rebirth after the collapse of its main trading partnern in the early 1990s, the Soviet Union.

Institutional investors such as the Finnish pension fund Ilmarinen are reducing their stake at the mobile firm. Ilmarinen, the second-largest shareholder, recently cut its investment at Nokia by 27% in the first quarter.

Elop is however keeping the stand on his commitment to Windows Phone software. “We make adjustments as we go. But it’s very clear to us that in today’s war of ecosystems, we’ve made a very clear decision to focus on Windows Phone with our Lumia product line,” he said. “And it is with that that we will compete with competitors like Samsung and (Google’s operating system) Android.” Shareholders are steadily losing confidence in the CEO and have stated that he is making a mistake. “He has closed doors. They don’t have new ideas now. Their fate is all in Windows Phones.” Juha Varis, senior portfolio manager at Danske Capital, which holds a stake at Nokia.

“He’s managed to decrease costs but not to increase market share,” said Magnus Rehle, senior partner in Greenwich Consulting, which advises telecoms companies. “Maybe they could go back to Google and say we also want to go with Android. Even if it hurts. Microsoft, they’ve had their chances, and are not managing to take off.”