Why does Nokia become a hot potato?

The day before yesterday, Huawei's takeover rumors stimulated Nokia's share price rose 8%, and today there are reports that Microsoft's bid for Nokia to break up, then rumors may be so fermented: July, Lenovo to buy Nokia, August, some British brokerage companies suspected Cisco executives fly to the Nokia headquarters in Helsinki. However, there is a very specific issue to consider when considering a takeover of Nokia.

What they want to do is buy a smartphone vendor, but Nokia is not a smart-machine company, it's still just a function maker. Why do you say that? Let's look at a set of numbers.

In the latest quarter, sales, Nokia features 56 million units sold, smart phone 6 million units, sales revenue, the function of 1.6 billion euros, smart machine 1.2 billion euros.

But this is not the biggest obstacle to a takeover of Nokia. In the quarter ended in March, Nokia's revenue fell 31% Year-on-year, with smartphone revenues down 32%. In terms of numbers, there is no sign that Nokia has switched from a feature machine to a smartphone.

Look objectively at the challenges you anticipate. In the second quarter of 2012 and the third quarter, Nokia continued to grow Year-on-year, with quarterly increments of 3 million units. Wall Street and the mobile phone industry have been shocked by the fact that almost everyone expects Nokia's handset sales to fall. The industry's top research institutions, including the prestigious GfK group, have been amazed by Nokia's feature-machine business, but when analysts have just revised their forecasts, Nokia's performance has again surprised them. In the quarter of Christmas, Nokia's function machine sales were lower than expected, in the first quarter of 2013, sales were reduced by 24 million units, staggering.

Nokia function Machine Business fluctuation amplitude is so intense, the reason is several. One important reason is that Nokia Asha handsets face competition from low-end Android rivals in Africa and Asia.

In the first quarter of 2013, Nokia's actual sales were 10 million different from those expected by many analysts. On average, Nokia still sells more than 55 million units per quarter, which will drop to 50 million in the first quarter of 2014, or 40 million or even 30 million units? Now all is just unknown.

Industry experts say the demand for Nokia's functional machines last year has been unusually irrational, but it is a problem that cannot be overlooked in terms of Nokia's profitability, its ability to maintain its scale and emerging market position. A slow decline in the number of functional machines will make Nokia relatively stable as a smartphone supplier, and if the sales slump will turn into a money-burning game.

So no company will buy Nokia until it is clear that Nokia's sales plummeted in the last winter was an anomaly or a sign of continuing recession.