Nokia Corp. (NYSE: NOK) reported better-than-expected first quarter earnings, boosted by sales in emerging markets and better than expected margins, sending shares rising over 3 percent in Thursday trading.
The world's largest cell phone maker said that first-quarter net profit slipped 6.6 percent to 979 million euros ($1.3 billion), or 0.25 euros ($0.34) a share, from 1.05 billion euros ($1.42 billion), or 0.25 euros a share, in the year-ago period. Consensus forecasts were for earnings per share of 0.25 euros.
Sales rose 3.7 percent to 9.86 billion euros ($13.4 billion), but came in below the average analyst forecast of 10.16 billion.
â€œIâ€™m encouraged by Nokiaâ€™s first quarter 2007 performance, said Olli-Pekka Kallasvuo, Nokia's CEO. Our profitability was strong, with both gross and operating margins up sequentially, excluding special items. We also saw good year on year device volume growth that led to an increase in our market share, further solidifying our number one position in the industry.
Excluding special items, the company said operating margin was up 13.6 percent, compared to 13.3 percent in the fourth quarter.
Compared to the fourth quarter of 2006, gross margin was up 33.1 versus 32.4 percent, while operating margin was up 13.6 percent, versus 13.3 percent.
The Finland cell phone maker said its gross margin for the quarter fell to 33.1 percent from 34.1 percent a year ago, but beat analysts' average forecast of 32 percent.
Nokia sold 91.1 million phones in the quarter, up 21 percent year-on-year, and estimated its market share at 36 percent, below analysts' consensus of 37 percent.
New York Stock Exchange listed shares of Nokia rose 78 cents, or 3.3 percent, to close at $24.65.