One of the biggest trends in technology and the investing world for 2012 was 3-D printing. Strong results from demonstrations, along with lower prices for home models have increased sales of 3-D printers dramatically. The two big public companies, 3D Systems (DDD) and Stratysys (SSYS), saw their stock prices increase 247% and 158%, respectively. Now telecommunications company Nokia (NOK) wants to get in on the fun by offering consumers unique products through the technology.
Nokia has announced that it will allow customers free software to print 3-D models of phone cases. The phone cases will be centered around the company's Lumia 820 model to start with. The company's new 3-D printing development kit (3DK) will let people create their own designs and then print them out at any 3-D printer. Nokia becomes the first major phone company to utilize the 3-D printing technology.
In a blog post (found in the link above), the company's community and developer marketing manager John Kneeland fielded questions. Kneeland promises that customers will be able to create more customizable phones in the future. Examples of how phones and phone cases can be unique through 3-D printing includes: waterproof, glow in the dark, bottle openers, and solar chargers. Kneeland says, "Someone can build it for you, or you can print it yourself." During the interview, the marketing manager compares the technology as the sequel to the Industrial Revolution.
One benefiting company from this increased technology might be Staples (SPLS). Back in December, Staples announced that it would be helping customers with 3-D printing through its "Staples Easy 3D" program. A partnership with Mcor Technologies will place 3-d printers in Staples stores in foreign countries beginning in this first quarter of 2013. No date has been announced for the United States Staples stores.
The big question in all of this 3-D technology is whether or not it will help Nokia sell more phones. Nokia is trying to differentiate themselves from larger players like Apple (AAPL) and Samsung (SSNLF.PK). The Lumia phones offer a Pureview camera that sets it apart. New technology and customized printing options may be a nice boost for the company. People buying smartphones are always looking for new technology and cool features that make their phone top of the line. Some will argue that memory, screen size and battery life are the most important features. I won't argue with that, but will say that 3-D printing will help Nokia sell more Lumias in 2013 than originally anticipated.
If you search the top 100 selling items in the "Phones and Accessories" category on Amazon, you will find cell phone covers throughout the list. Specifically, you will find iPhone covers made by Otterbox, the leading cell phone case maker. On Otterbox's website, you can customize your case with color combinations. However, Nokia will be the first to let people truly customize their case and cover.
In December, an analyst at UBS raised his unit guidance numbers for Lumia phones. His reasoning was the phone appearing on several top-selling lists going into the Christmas holiday. Fourth quarter estimates were listed as 4 million. The analyst raised his 2013 forecast to 20 million, from a previous 18 million, and also raised his 2014 forecast to 25 million units, from a previous 22 million units. These raises in guidance kept him bullish on the stock as well.
Nokia reported part of their fourth quarter earnings numbers. In the fourth quarter, the company sold 6.6 million total smartphones, of which 4.4 million were Lumia phones, beating analysts' expectations. The company saw an operating margin of 0-2%, which is a huge improvement over the expected -6% margins previously forecasted. The company will report its full earnings on Thursday for the fourth quarter and full year. Analysts on Yahoo Finance expect the company to report a profit of $0.05. This would give the company a net loss of -$0.24 on the fiscal year. In 2013, analysts expect earnings per share of $0.02. However, this is when factoring in revenue loss of 1.4%. Even though Nokia had a strong 2012, I think the success of the Lumia phone will carry into 2013 and should help Nokia present bullish first quarter and full year guidance on Thursday. Shares ran up 10% on the pre-announcement of fourth quarter Lumia sales and could have a similar result this week.
Nokia shares have been on a run, after bottoming out under $2 in July. In the past fifty two weeks, shares have traded between $1.67 and $5.87. Since my September article, where I thought shares could hit $5, shares are up 49%. Shares hit a high of $4.70 since that article and could see $5 with strong fourth quarter earnings or first quarter guidance this week. Thursday will provide a lot of answers for Nokia and its road to recovery ahead. The 3-D printing will likely not be in the guidance for 2013, so you might have a piece of information not factored into the share price.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.