Nokia was dealt a blow by Moody's Investors Service, a substantial downgrade after the company purchased Siemen's share of the Nokia Siemens Networks (now Nokia Solutions and Networks). The company was lowered one level to B1 with a rather negative outlook stated by Moody's. Nokia executive VP and CFO, Timo Ihamuotila, today commented on the rating decision.
"We are pleased that the strong cash position we have maintained throughout our transition has enabled us to take advantage of an opportunity to acquire full ownership of NSN, whose financial performance has strengthened markedly in recent quarters. In Devices & Services, we are pleased with the Lumia volume growth we delivered in the first half of this year and are looking forward to driving further share gains for the ecosystem. With these efforts our target is to return our Devices & Services business to sustainable cash generation as soon as possible."
Nokia is in a difficult position and has been since the company chose to switch to Windows Phone and work with Microsoft on a brand new mobile platform. We've covered the continued release of financial reports that began to show signs of improvements being made, but not at a speed to please those who are sceptical about the company's future. NSN has become profitable, which Nokia will at least take full advantage of.
The statement notes that Nokia has access to additional liquidity via a revolving credit facility of 1.5 billion euros, which is entirely undrawn and available to the company through March 2016. As well the above, NSN has a 750 million euro revolving credit facility, also entirely undrawn and available through June 2015.
Nokia will look at further expanding NSN and working with Microsoft and partners to build on its current line of Lumia hardware. Let's not forget some upcoming Windows tablets too.