Nokia Q2 sales, income jump

Handset earnings fall

By Tony Smith • Get more from this author

Posted in Financial News, 21st July 2005 11:10 GMT

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Nokia today met its own earnings forecast but fell short of analyst expectations when it posted its Q2 results.

The three months to 30 June yielded revenues of €8.1bn ($9.8bn), up 24.6 per cent on the €6.5bn ($7.3bn) it recorded for Q2 FY2004.

Net income came to €799m ($966m), or 18 cents a share - 15 per cent higher than the year-ago quarter's €695m ($840m), or 15 cents a share. The final figure was at the upper end of Nokia's forecast, made in April, of 15-18 cents, but below the 19 cents per share income analysts polled by the Reuters newsagency had been anticipating.

The Finnish giant's mobile phone sales grew 20 per cent year on year, from €4.1bn ($4.8bn) to €4.9bn ($5.9bn), but falling average selling prices knocked that business' income contribution down from €802m ($970m) to €789m ($954m), a decline of 1.6 per cent. Mobile phone margins fell from 19.8 per cent to 16.2 per cent. Unit sales were up 34 per cent year on year, taking Nokia's market share to around 33 per cent, the company calculated.

Like rival handset maker Sony Ericsson earlier this week, Nokia upped its forecast for 2005's global handset sales, to 760m from 740m. Sony Ericsson's estimate is 720m units. The extra sales will come from "an expanding mobile subscriber base in developing markets", Nokia said.

Looking to its own future, Nokia predicted Q3 earnings of 14-17 cents a share on sales of €7.9-8.2bn ($9.6-9.9bn). ®