HELSINKI (Reuters) - Top mobile phone maker Nokia’s
fourth-quarter sales and profits beat expectations as it regained market share in smartphones, sending its stock price 14 percent higher.
The strong results cap an otherwise tough year for Nokia and the cellphone industry, which have been hammered as consumers cut spending in the recession.
Shares in Nokia were 14.75 percent higher at 10.35 euros by 1256 GMT, helping to lift the DJ Stoxx European Technology Index
The shares are back up to the level they were trading at before weak third-quarter results hit by losses in smartphone market share.
Nokia’s underlying fourth-quarter earnings per share fell slightly from a year ago to 0.25 euros, but still beat all expectations in a Reuters poll, which ranged from 0.15 to 0.24 euros.
“Unbelievably strong report in every aspect,” said analyst Per Lindtorp from Erik Penser in Stockholm.
Nokia repeated its forecast for the handset market to grow 10 percent in 2010 from a year ago.
“This quarter gives us good momentum to build for in 2010,” Nokia Chief Financial Officer Timo Ihamuotila told Reuters TV, but he said there was still reason for cautiousness.
“Regarding (the) economy we are not out of the woods yet... consumer confidence is still fragile,” he said.
The result marked an end to a steady stream of market share losses for Nokia’s smartphones, with the firm saying its share rose to 40 percent in the last quarter from 35 percent in the third quarter of 2009 as it launched new models.
Nokia had been hurt in recent quarters by a dated portfolio of smartphones, with Apple’s iPhone and Blackberry-maker Research in Motion both eating into its share of this fatter margin business.
“Nokia’s smartphone performance saw a reassuring improvement despite a strong quarter for RIM and Apple,” said Geoff Blaber from British consultancy CCS Insight.
Nokia said revenues from smartphones jumped 26 percent from the previous quarter to 3.9 billion euros. Average smartphone prices dipped to 186 euros from 190 euros in the third quarter as the firm tries to win back customers with simpler, cheaper smartphones.
Nokia proposed a dividend of 0.40 euros per share, beating the average expectation of 0.31 euros in the poll, but within the range of estimates.
Reporting by Tarmo Virki, Brett Young, Eva Lamppu, Terhi Kinnunen and Helena Soderpalm; editing by Elaine Hardcastle