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(NOK) - Get Nokia Oyj Report

launched seven new phones Monday, and its shares jumped 5.8% amid the stock-market rally.

The world's largest wireless handset maker said its new models will be released before the end of the first quarter of 2003, with one phone coming out before the end of this year's fourth quarter.

Faced with falling growth and a decline in new wireless subscribers, Nokia and its competitors are banking on sales to current subscribers who are looking to upgrade aging handsets. The companies expect that consumers will be attracted to phones with color screens, built-in cameras and high-speed Internet access.

Carriers in the U.S. such as

AT&T Wireless



Sprint PCS



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have invested hundreds of billions of dollars on upgrading their network infrastructure to enable subscribers to send and receive pictures, download music and play games on new handsets.

Analysts say handset manufacturers' ability to meet financial targets is dependent on timely releases of the phones. "Some slippage in the release of new phones by some vendors may place increasing pressure on the need for robust sales in the last two weeks of November and December," said Lehman Brothers wireless equipment analyst Tim Luke in a report.

As for Nokia, investors have been watching the company's progress in the fourth quarter closely, for clues on whether the handset maker will meet its sales forecasts.

"While an uptick of over 22%

compared with the third quarter in handset sales for Nokia appears doable for

the fourth quarter, it seems that execution on the timely release of new platforms is likely to be increasingly important," said Luke.

Meanwhile, Merrill Lynch wireless-equipment analyst Sherief Bakr said investors shouldn't place undue attention on Monday's news from Nokia. "The key sales time for the fourth quarter will be in the next three to four weeks," said Bakr, who has a neutral rating on the stock. "It's still too early to make a call now on what's going to happen." Merrill Lynch hasn't done any investment banking for Nokia.

New devices are expected to propel Nokia's fourth-quarter sales by 2% to 5% to a range of 8.9 billion euros ($8.85 billion) to 9.2 billion euros, compared with the year-ago period. Fourth-quarter pro forma earnings per share are expected to be 23 euro cents to 25 euro cents.

At the end of the third quarter, company executives backed away from initial bullish industry-wide expectations of 10% growth in phone sales for 2003. In a conference call with analysts at the release of Nokia's third-quarter earnings, Chief Executive Jorma Ollila said the company will wait until its fourth-quarter earnings report in January before updating the outlook for 2003. "I don't think the economy is exactly flying," said Ollila. "You'll see some cautiousness not only by me but also by consumers."

That cautiousness was nowhere to be seen Monday morning, as the company unveiled its new portfolio of gadgets, including a phone that, when unfolded, reveals a full keyboard to type messages. New phones also include a radio tuner, support for Java-based applications and picture-sending capabilities. The company also plans to sell a detachable camera that doubles as a hands-free headset. The company also plans to release a handheld video-game device that has phone capabilities.

Nokia's American depositary receipts were up 97 cents at $17.87 in late trading.