Nokia reported stronger-than-expected profits for the third quarter, boosted by solid demand for its cheap smartphones, and said today it would cut up to 1,800 jobs.
Third-quarter underlying earnings per share for the world's largest handset maker dropped to 14 cent from 18 cent a year ago, but beat all forecasts - which ranged between 8 to 0.12 cent.
Sales rose 5 per cent to €10.3 billion. Nokia sold 26.5 million smartphones in the quarter, 61 per cent more than the year-earlier period and better than analysts had estimated. Nokia said it expects fourth-quarter devices and services sales of between €8.2 billion and €8.7 billion.
The results were the first since Canadian Stephen Elop took over at the helm of Nokia on September 21st from Olli-Pekka Kallasvuo, who presided over a halving in Nokia's market value during his four years in charge.
The company has been struggling to win back share in the high-end smartphone market, which shrank in the past three years as consumers moved to Apple's iPhones and devices using Google's Android platform.
In its key phone unit Nokia was able to increase average sales price to €65 - the first annual price rise in almost a decade.
"I think it's an excellent report given that the company's portfolio of products was very weak in the quarter," said Morgan Stanley analyst James Dawson.
"The handset profits are 30 per cent ahead of expectations, so it's clearly a very big beat versus what the market was looking for," Mr Dawson said.
Nokia said job cuts - close to 3 per cent of staff at its main business - would hit most product creation business in its Symbian Smartphones organisation and its services organisation.
"The guidance for Q4 is more or less in line with expectations. It is positive that they focus on costs," said analyst Martin Nilsson from Handelsbanken.
Bloomberg, Reuters