It has been revealed that Nokia is set to sell its digital health division back to its original co-founder, Withings. It was reported that other competitors, such as Samsung and Nest, had also expressed interest.
Reports have been afloat for some time, where Nokia announced that is was set to review its strategic options for the business earlier this year. Its Q1 figures revealed that the division bought in $20mn, in stark comparison to its overall net sales of $5.9bn.
Following on from selling its health arm to Microsoft for $7bn, the company had acquired its new digital health unit to take on Apple within the growing health-tech space, in areas such as blood pressure monitoring, glucose tracking and more.
However, its portfolio has struggled against Apple’s strong foothold in the market, where the company has now taken the decision to sell its consumer health division altogether.
A leaked memo, obtained by MobilHealthNews, highlighted the gravity of the situation for the unit upon the company’s decision to sell.
“Rather than only falling in love with our technology, we must be honest with ourselves,” Kathrin Buvac, Nokia’s chief strategy officer, stated. “In its entirety, our Digital Health business has struggled to scale and meet its growth expectations. Currently, we don’t see a path for it to become a meaningful part of a company as large as Nokia.”
The planned sale will therefore become part of Nokia's increased focus to develop new tools for the B2B market, rather than towards the consumer-led health industry. The move will also include its smartwatch business. The deal is expected to close in late Q2 this year.
"Nokia and Éric Carreel recognise that as an original Co-Founder of Withings, he is best positioned to carry the company forward into its next phase," commented a Nokia spokesperson.