I wouldn't count them out yet. Part of their estimates were something they knew could happen but the slow adoption rate in Europe wasn't anticipated. China and India could be a big market for them and if they can continue to drive that market and increase their footprint they can survive rather well without Europe's fast adoption. The US so far has given them good acceptance and it will be further pushed when Verizon pushes the Apollo or WP8 phones. The Iphone is losing its saturation rate in the market and as expected they will continue to do so as MFR's step up their game with better designs such as a HTC One X/S, Samsung Nexus/Galaxy and Motorola Droid lineup. HTC took one across the chin for too many phone releases last year and had learned the hard way. I hope that many Phone Mfrs learn from this. You fragment the market and the market will respond in kind. We don't need 30 phones a year from one company. Serve other markets with a few phones per market. Design better hardware not just cram specs down our throats.
What WP 7.5 has shown other OS's is that you can design a better OS through engineering and not just increased specs alone.
The Lumia lineup is the appetizer to the Apollo/WP 8 main course. The Windows Phone lines up needs HD displays, removeable storage or increase capacity at least to 32GB along with 2nd GEN LTE on a chip and dual processors. Verizon can push phones when they want to. Look at Motorola and the DROID lineup. They have pushed so well people call most ANDROID phones DROID phones it seems.
MS has my vote of confidence with Windows 8 and WP8. Nokia will make some radical changes in WP8 much greater than they have done at the moment. That will be true test of their future and I hope its a bright one for them.
I want 4" phones to come back in droves. 4.3" is too large for single handed use for most people. No I don' t have girly hands

Apple wasn't stupid in their design of the 3.5" screen when it comes to single thumb texting and usage.
I would not put the stock at JUNK rating that is just a bad call. I would put them at neutral and continue to hold my shares as well as buy some new shares. I like the underdog and I think this dog will hunt again by the end of the year.