The long term future of HMD Global and Nokia phones

EDIT:

The long term future of HMD Global and Nokia phones

SirFaceFone SirFaceFone
✭✭✭  /  edited April 6
EDIT: I wrote this post months ago but was stuck in draft for some reason so it might have outdated/missing info (Also I didn't bother researching/editing further, I'm too lazy rn). Thought I might as well post it as is since it's still an interesting topic.
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So I've been thinking about this lately and there doesn't seem much discussion about this topic.

From what I understand, HMD relies on investor funding from these three: (source)
Ginko Ventures, FIH, and more recently DMJ Asia Investment Opportunity, which gave HMD a market valuation of USD1 billion and achieved unicorn status in the process.

So a quick recap of HMD's history:

2016
• HMD is founded and they get the rights to sell Nokia branded phones and tablets for 10 years.
• $500 million will be spent over three years on marketing
2017
• HMD want to become one of the top players in the market in the next 5 years
• HMD sold around 70m phones at the time
2018
• HMD raises 100m USD from Ginko and DMJ giving it unicorn status
• Flagships (N8S, N8) aren't doing so well compared to midrange/low-end phones
• More accessories planned to expand ecosystem
2019
• Nokia 9 PureView released and receives mediocre reviews
• HMD is still struggling in the smartphone front, especially in the higher end segment, selling only ~5m smartphones


So what is the long term future for HMD? Surely they can't rely on investor funding forever.

• Do they get bought out by a larger company?
• What happens after the 10 year agreement ends?
• Does Nokia acquire the company after the license expires in 2026?

Would love to know others' thought on this.








Comments

  • singhnsk singhnsk
    ✭✭✭✭  / 

    Hi @BootloaderUnlockWhen, quite recently, in the FIH's report, it was revealed that the Q4 2019 brought operating profit for HMD Global, which happened for the first time.

    We don't know much about their financial status as the company is still behind the closed walls. FIH Mobile has a good reason to reveal such an info because that can help hmd more investments (which they are currently eying), so, it can be not fully right too.

    I believe their initial plans didn't work out well and there has been change of roles at so many places. The worst was probably when CEO was switched to be taken over by somebody from HTC (I ain't a fan of people who have failed other companies).

    Let's see how they plan in the year 2020. It should be make and break for them.

    And for the license renewal, nobody knows 🤣 Maybe Nokia plans to acquire them if they manage to make some space. Or else, just give up and license the brand further if they are still somehow alive until then. Or tag them as incapable and license the brand over to some other company 🤷‍♂️ The new incoming CEO at Nokia will have a role to play in it too. Let's see how he thinks and plans.

  • San.Phu San.Phu
    ✭✭✭  / 

    On current situation it's very blur 😃😉.

  • andigruber02 andigruber02
    ✭✭✭  / 

    Don't forget, that the original Nokia is also in trouble with there 5G Plans and they will get a new CEO in autumn 2020 and checking Out the Options to make a Fusion with ericsson.

  • madbilly madbilly
    ✭✭✭✭  / 

    Hi all,

    "We don’t want to join those smartphone players who just do boring campaigns. The people are bored because marketing wise it is just more of the same right now from celebrity endorsements to focusing on tech and spec.”

    Oh @pekka rantala where did it all go wrong! 😕

    Those were the days of hope, and sadly they didn't last long.

    @singhnsk Florian Seiche was already president when Arto Nummela left; Florian took over and has been joint president and CEO ever since. Who know's why Arto left, perhaps he was only ever there was a figurehead to get investment and launch the company. Maybe he disagreed with the Android One approach, when it became clear that that was an option (first HMD devices were pure secure and utd, but not Android One), and Juho's vision for blandness won.

    Going back to @SirFaceFone's question: I think HMD want to be bought, but I think that they are realising that nobody really wants to buy them. Nokia won't buy them because Nokia make much much more money from licensing the patents they own to all smartphone makers, and if Nokia bought HMD then Nokia would have to sell those patents for a lot less or be accused of monopolising - this is one of the reasons Nokia originally decided to sell the phones business, because despite the fact the volumes were still very large they could make more money from licensing.

    Cheers 🙂

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