Nokia Q4 above forecasts

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.

The results cap a tough year for Nokia and the cellphone industry, which have been hammered as consumers cut spending in the recession. Nokia posted its first ever quarterly pretax loss in the January-March quarter.

The Finnish firm has also been hurt by a dated portfolio of smartphones, with Apple's iPhone and Blackberry-maker Research in Motion eating into its share of this fatter margin business.

But Nokia said its share of the smartphone market rose to 40 percent in the last quarter from 35 percent in the third quarter of 2009 as it launched new models.

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.

The shares rose 11 percent to 10 euros by 1129 GMT.

(Reporting by Tarmo Virki; editing by Elaine Hardcastle)