Following in the footsteps of LG and Sony Ericsson, Nokia (s NOK) today reported a poor performance for the fourth quarter of 2008, for which it blamed the global economic downturn. Handset sales during the latest three-month period were 113.1 million, down 15.3 percent from the fourth quarter of 2007 and 4 percent lower than third-quarter 2008 sales of 117.8 million units. Nokia also lost 1 percent market share during the quarter. And not only did they sell fewer phones, they sold them cheaply; Nokia’s average selling price for a handset declined to 71 euros from 83 euros.
But forget all that, for the worst is yet to come. Nokia is forecasting a 10 percent decline in global handset sales — not just for the company but for the entire industry. This is not a good sign for anyone making a living by selling to the mobile industry, especially chipmakers like Texas Instruments (s TXN).
Nokia had previously forecast a 5 percent decline in sales, so things are clearly a lot worse than anyone thought. Sales are going to be swimming with the fishes for the first half of the year, Nokia indicates, though things might get marginally better in the second half of 2009.