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Nokia Oyj (NOK1V)’s North American chief, Chris Weber, was named head of sales in Chief Executive Officer Stephen Elop’s biggest management overhaul, taking on the task of winning buyers for the new flagship Lumia phone line.
Weber, who like Elop is a Microsoft Corp. (MSFT) veteran, will take over responsibilities now held by Jerri DeVard and Niklas Savander, who are both stepping down, the Espoo, Finland-based company said in a statement today. Timo Toikkanen will succeed Mary McDowell as head of the mobile-phone division, which makes low-end handsets mainly for emerging markets.
“They needed to change management,” said Helena Nordman- Knutson, an analyst at Pareto Securities in Stockholm. “It was overdue.” The CEO “is not a management consultant, and he couldn’t make decisions on management in the first months because the focus was on operating systems. Now he has had time to evaluate the people.”
Elop, who became CEO in 2010, is betting on smartphones using a version of Microsoft’s Windows technology to rebuild market share after losing ground to Apple Inc. (AAPL)’s iPhone and devices operating on Google Inc. (GOOG)’s Android platform. The turnaround hasn’t stopped losses yet and Nokia, which is trying to conserve cash, outlined plans today to cut as many as 10,000 jobs and shutter sites in Finland, Germany and Canada.
North America under Weber was the sole region where Nokia increased handset shipments sequentially in the first quarter, helped by the release of the Lumia 710 through Deutsche Telekom AG (DTE)’s T-Mobile division in January. Shipments in the quarter, in advance of the release of the Lumia 900 phone, were still down 50 percent from a year earlier.
Weber “has made tremendous strides in kick-starting our re-entry into the U.S., and his track record of driving results will serve Nokia well,” Elop said in the statement.
In an interview a week ago, Weber, who was born in 1965, said Nokia needs to show wireless operators why the Lumia stands out against the competition if it wants to expand deals with carriers and sell more devices.
Toikkanen, born in 1966, was previously head of business development. He has worked for Nokia in the greater China area and Singapore. Weber, Toikkanen and Juha Putkiranta, who was appointed executive vice president of operations, will join Nokia’s executive board, now called the leadership team, as of July 1, the company said.
Nokia has lost more than 70 billion euros ($88 billion) in market value since Cupertino, California-based Apple introduced the iPhone in 2007, taking the lead in smartphone innovation. Nokia’s operating margin for mobile phones plunged to 3.7 percent of revenue last year from more than 20 percent before the iPhone went on sale.
The Finnish company now predicts second-quarter operating margins at the devices unit will be worse than a loss of 3 percent of revenue in the first quarter, Nokia said today. The phonemaker had projected margins would be “similar to or below” the first-quarter figure.
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