Solid sales of new handsets lift Nokia and take the pressure off boss Elop

Nokia said strong sales of Lumia smartphones helped its mobile phone business achieve underlying profitability in the fourth quarter, raising hopes the struggling handset maker may be past the worst.

The Finnish company, which has been losing market share to Apple and Samsung, said the better-than-expected result was also helped by cost-cutting and a buoyant performance from its Nokia Siemens networks unit.

The update lifted some pressure from chief executive Stephen Elop. Success of the high-end Lumia smartphones has been considered particularly crucial for the company’s survival.

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“We’re very pleased with the Lumia response,” Elop said, although he added that sales of the latest 920 models, which use the Windows Phone 8 software, had been constrained by a shortage of supplies.

Mirabaud Securities analyst Susan Anthony described it as a “good start”. But she, like other analysts, was slightly cautious on whether the Lumia strategy was really succeeding.

“We still need evidence that the good initial momentum can continue and will not stall as happened with its Windows Phone 7 devices,” she said.

Nokia would not say how many of the 4.4 million Lumias sold were the newest models rather than the heavily discounted ones launched earlier, leaving some analysts sceptical.

Redeye analyst Greger Johansson said it was too early to call it a turnaround for the company. Official results, including more details on Nokia’s profit and cash position, are due on 24 January.