Nokia Drops 10 Points on New Warning

Smarting from its beating in the mobile phone battle, Nokia issued its second sales warning in as many months.
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NEW YORK (

TheStreet

) --

Nokia

(NOK) - Get Report

, crushed by competition, issued its second sales shortfall warning in two months, sending shares down 10% Wednesday.

The Finnish phone giant said competition in smartphones and a declining euro will cause second quarter sales to fall below the $12.9 billion target range analysts had predicted. The weak sales will also likely narrow Nokia's gross margin more than expected, the company said in a statement Wednesday.

Nokia also said that while its projection for 10% industry growth is on track, the company expects to lose more market share than it had last year.

The warning from the top phone maker comes as demand for new generation smartphones like

Apple's

(AAPL) - Get Report

iPhone and

Google

(GOOG) - Get Report

Android phones is currently greater than supply. The contrast between Nokia's woes and Apple's popularity was especially sharp this week.

>>Video: Nokia, Failure to Launch...Again

Due to heavy traffic, Apple partner

AT&T

(T) - Get Report

ran into several disruptions as

iPhone buyers swarmed

the companies' Web sites to place orders Tuesday.

Nokia has struggled famously to get onboard the touchscreen trend sweeping through the mobile phone market. Analysts have predicted that three years late may be too late.

"This was always going to be a tough quarter," said MKM Partners analysts Tero Kuittinen. "But the surprise is that Nokia now warned about the second quarter twice."

Nokia shares fell 99 cents, or 10%, to $8.83 in premarket trading Wednesday.

--Written by Scott Moritz in New York.