Nokia is scheduled to report its second-quarter results on Thursday, July 21, before the market opens.

Wall Street expects the Finnish company to report earnings of 3 cents a share on revenue of $13.04 billion. In the second quarter of last year, the company earned 14 cents a share on revenue of $13 billion.

Meanwhile, expectations for the second quarter as well as the third quarter are quite low as the company has already pre-reported the June quarter and suspended guidance for the remainder of the year.

In May, Nokia had said its handset revenue would be substantially below its earlier guidance of 6.1 billion euros to 6.6 billion euros.

Nokia, which was once the mobile phone giant, has struggled to gain ground in the market over the last few years, largely due to intense competitive pressure from Apple (NASDAQ:AAPL), Research in Motion (NASDAQ:RIMM), Motorola Mobility (NYSE:MMI) and Samsung in the smartphone segment.

As a result, Nokia has lost overall mobile phone market share, suffered from declining profit margins and scrapped its smartphone operating system for future models creating significant uncertainty for the firm's outlook.

The wildcard in the quarter will be any update regarding its Windows Phone progress or potential launch date.

The primary investment thesis would be centered on a successful launch of smartphones based on Microsoft's Windows Phone operating system and effective follow through.

We continue to believe that Nokia's adoption of the Windows Phone O/S was the right strategy as carriers are looking towards a third ecosytem in the marketplace, Rodman & Renshaw analyst Blaine Carroll wrote in a note to clients.

Currently, Apple's iOS and Google's Android are the leading smartphone operating systems.

..Carriers are beginning to differentiate their product line-up by operating system and not simply point products. We feel this will benefit Nokia as the Windows Phone ecosystem continues to develop, Carroll said.

However, the analyst warned that the next couple of quarters will remain challenging for Nokia as its Symbian product line is not able to effectively compete in the marketplace.

Weak Q3 Outlook

Analysts expect Nokia to issue a weak forecast for the third quarter as the initial Windows Phones would not ship until fourth quarter.

Scott Sutherland of Wedbush Securities said he would not be surprised to see a cautious Q3 outlook.

We expect a guide down for 3Q11 as the company has instituted aggressive pricing tactics in order to hold on to market share, Carroll said.

However, with the introduction of Windows Phone-based devices expected by year end, analysts believe that Nokia would once again be well positioned in the marketplace and should appeal to value investors.

Sutherland writes, However, with cost reductions and sales of new smartphones based on the Windows Phone OS start to pick up, we believe Nokia's fortunes could start to improve.

But, Gleacher & Co. analyst Stephen Patel thinks otherwise.

He expressed concern that the Windows Phone share loss is accelerating in the U.S. and is apprehensive whether Nokia would be able to spark consumer interest. However, he acknowledged that the total addressable market for Windows Phone could double next year as Microsoft (NASDAQ:MSFT) adds languages and Nokia brings in new carriers.

With the low-margin feature phone business under pressure and minimal visibility on Symbian sales and Windows Phone consumer adoption, we see little reason to own shares, Patel wrote in a note to clients.

ADRs of Nokia were up 2.71 percent in Wednesday morning trade at $5.71 on New York Stock Exchange.