LONDON -- It seems
just couldn't help blurting out the good news.
Moving up its third-quarter results by a week to Thursday, Nokia announced that pretax profit during the period rose 43% to 1.34 billion euros ($1.13 billion), above analysts' expectations of around 1.10 billion euros. Earnings per share increased to 0.19 euro compared with 0.14 euro a year ago. Nokia's net sales increased by 50% to 7.58 billion euros.
In the handset division, sales of mobile phones rose 59% to 5.46 billion euros and the division posted an operating profit of 1.07 billion euros, an increase of 42%. This represents an operating margin of 19.6%, down slightly from the 21.9% in the period last year, but still at the high end of analysts' expectations.
"These results are excellent. This is going to take away the concern that the mobile-phone market is leveling out," says Gunnar Andersson of
, who has a strong buy rating on the stock. (Handelsbanken has no investment banking relationship with Nokia.)
There have been plenty of concerns. Nokia's competitors, such as
, predict slowing growth in the mobile-phone market and diminishing margins, a forecast that has taken its toll on global equity markets. Nokia's sterling results have lifted not only its stock, which has been flagging of late, but also some of the gloom that had settled over Europe's markets recently.
By midmorning, Nokia shares were up 5.59 euros, or 15.7%, to 41.40. The
was up 43 points, or 0.5%, to 6191 and the
in Frankfurt was up 51 points, or 0.8%, to 6534.
Nokia's outlook for the wireless market also couldn't be in more direct contrast to its competitors' view. Nokia's view on the wireless world is seen as important by people in the market, as it is considered one of the most credible forecasters in the business.
For itself, Nokia said it is heading toward making record-breaking profits in the fourth quarter, and reiterated its forecast that it expects to meet its sales growth target of 25% to 35%.
For the mobile business as a whole, Nokia estimates that global mobile-phone user penetration has now surpassed 10%. It sees the worldwide subscriber base reaching 700 million by year-end, and repeated its forecast that this will reach the one billion mark by 2002.
As usual, Nokia did not give a figure for its market share, but said it "has continued to increase its global market leadership compared to both the previous year and quarter."