Nokia shows smart turn of $1.3bn profit

Published on Thursday 28 January 2010 20:42

NOKIA, the world's biggest mobile phone maker, yesterday said strong sales of smartphones and lower costs helped net profits rise 65 per cent to $1.3 billion (£805 million) in the fourth quarter, despite a 5.3 per cent fall in sales.

The better-than-expected report sent Nokia shares surging and suggested that the sector is recovering from the impact of the global financial crisis.

Chief executive Olli-Pekka Kallasvuo predicted total global mobile phone sales would grow 10 per cent in 2010, and that Nokia would retain its market share.

Nokia products account for four out of every ten phones sold worldwide. "This quarterly result shows that there is a quite a lot of momentum in the mobile phone market, and that was also apparent in Nokia's result," he said.

The Finnish company said its share of the global handset market grew to 39 per cent in Q4, from 38 per cent in the previous quarter and 37 per cent in the fourth quarter of 2008.

In smartphones, where competitors include Research in Motion's BlackBerry and Apple's iPhone, Nokia said its market share rose from 35 to 40 per cent.

"This was the surprise. Many had expected Nokia's share of smartphones to fall even lower from earlier figures," said Michael Schroeder from FIM Bank. "Across the board, Nokia did pretty well."