Fashion Faux Pas Clips Nokia

Nokia (NOK Quote) got caught napping.

Like a sporting goods store peddling hockey sticks in the thick of T-ball season, the Finnish wireless giant paid the price Tuesday for a winter of pushing the wrong buttons with consumers.

As it turns out, what cell-phone users were demanding was the folding photo phone being churned out in quantity by outfits like Samsung and Motorola (MOT Quote). But Nokia didn't have any of these so-called midprice color-screen models, as first-quarter numbers will amply demonstrate. The strategic shortfall cost the world's largest handset maker more than 2 percentage points of market share, along with a 2% sales decline.

The sharp miss shocked investors, who had been all set for a 5% sales rise on the heels of Nokia's bullish January comments. Tuesday's reversal sent the shares down $3.47, or 16%, to $17.68.

Betting Wrong

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