Are you sure?

Nokia Siemens CEO resigns, Services head steps in

The chief executive of Nokia Siemens Networks NSN.UL has resigned and will be replaced by Rajeev Suri, head of the telecom equipment maker's key Services unit, Nokia said on Tuesday.

Suri, 41, joined Nokia in 1995 and has been an NSN executive board member since 2007. Services are gaining in importance for western vendors as they struggle to compete with hardware pricing from Chinese rivals like Huawei.

Suri will take the helm at NSN - a distant second to Ericsson in the shrinking global mobile network-gear market - from October 1. Former CEO Simon Beresford-Wylie will leave in November after a handover period.

“We began a comprehensive succession process when Simon shared his desire to depart at the appropriate time,” Nokia said in a statement. A spokesman said no significant change in strategy was anticipated.

Nokia shares fell 2.2% to €9.49 by 7:44 a.m. EDT, underperforming the European technology index, which fell 0.9%.

“Nokia Siemens is between the devil and the deep blue sea - it's neither a technology leader nor a cost leader,” said Richard Windsor, global technology specialist at Nomura.

“The key for us is gross-margin recovery, and at the moment that's looking like a pretty tough thing to do.”

NSN's second-quarter gross margin was 28%, down from 31.5% a year earlier. Sales fell 21% year on year. (Reuters)