Nokia Navigates Transition to Windows Phones

Nokia took a sizable hit in last quarter, continuing to lose its dominant place in the global mobile market due to the increasing popularity of higher-end smartphones. The Finnish company saw a 23 percent decrease in smartphone sales, partly due to fallout from its abandonment of the Symbian platform, which shifted users toward Samsung and Apple.

CEO Stephen Elop took the losses in stride, emphasizing the inevitable bumps along the road to change. "We still have a tremendous amount to accomplish in 2012, and thus, it is my assessment that we are in the heart of our transition", said Elop.

Nokia's reports belie the strong early performance of its Windows phones, the company's new featured product. Nokia launched the Windows Phone-based Lumia in several international markets to positive results. The phone sold out in the U.K., and shipped more than a million headsets overall.

AT&T will exclusively carry the Lumia 900 in North America in the upcoming months, demonstrating confidence in Nokia and Window's partnership and marketability.

Nokia partnered with Windows and dropped development of its Symbian platform in 2011, dramatically shifting its focus to rekindle and re-market its brand. The quarterly reports are disappointing, but exceeded analyst expectations, with Nokia chalking it as part of its transition.

The company isn't expecting to rake in profits during this difficult period. Nokia sees the transition as an investment in its future appeal, and likely expects to feel some growing pains during the process. The company remains optimistic about what it will blossom in a few years' time, anticipating a significant resurgence.

In the meanwhile, it will continue to lean on its strengths in feature phones and emerging markets, though the rise of low-cost Android phones in regions like India, China and the Middle East is expected to challenge Nokia in its strongest sector.

Nokia's transition has its risks, but analysts share the company's confidence that they will pay off in the future. Despite the quarterly reports, Nokia is focused on maximizing its Windows partnership's potential and will likely continue to face challenges until its strategy bears fruit.