Nokia has produced its figures for the second quarter of 2010 - and it doesn't make for comfortable reading if you're a Nokia shareholder.

Profits are down by 40 per cent on the same period in 2009, despite the firm selling slightly more handsets.

There is a concern that Nokia is having to slash the cost of its line-up in order to compete with the likes of Apple and RIM.

There is also trouble in the camp, with severe pressure being heaped upon CEO Olli-Pekka Kallasvuo. Nokia officially decided not to comment on speculation that the Nokia boss may be on his way out, although Kallasvuo did admit to CNBC that the murmurs "must be brought to an end one way or another".

Could this be the first major indication that Nokia's empire is about to fall? Sure, we've heard about how Nokia is struggling to compete with the likes of Apple and RIM in the past, but a 40 per cent year-on-year drop - that's massive.

Is it curtains for the Finnish giant - or can it be saved by the N8? Well, we've had our hands on the N8 and whilst it's an improvement on anything in Nokia's current portfolio, it still lags way behind anything that we've seen from Apple.

It's not in the same league as the top end Android handsets either, which will be of great concern for Nokia. After all, it has already ruled out employing Android on its own devices.

However, the N8 we played with wasn't the finished article, so maybe it will be vastly improved by the time it hits the market. We kind of hope so.

Or maybe Nokia won't even try and compete with the high-end smartphones with the N8 at all - it will be interesting to see how it prices the device. But we already know that Nokia wants to become the leader in the smartphone market - Nokia's head of mobile solutions, Anssi Vanjoki, said he was "obsessed with getting Nokia back to being number one in high-end devices".

Perhaps the N8 isn't the saviour device, that Nokia is pinning its hopes upon. Don't forget that Nokia told Pocket-lint that MeeGo would be the OS of choice for high-end devices in the future.

So could it be MeeGo that gets Nokia back on top? Possibly, although there will be some worrying times ahead for the once indisputable mobile phone champion as it waits to find out.

Is Nokia on its way out, or has the Finnish giant got a few tricks up its sleeve that it's still yet to play? Let us know what you think using the comments below.