HELSINKI (AFP) - Finnish mobile phone giant Nokia posted better-than-expected third quarter results, possibly marking a turnaround after failing to pick up on the popularity of clamshell phones, and predicted overall growth in global handset sales this year.
During the three-month period the Finnish firm saw a turnover of 6.94 billion euros (8.58 billion dollars), up from the 6.87 billion euros the company posted for the same period a year ago.
Nokia's earnings per share (EPS) however slipped to 0.14 euros (0.17 dollars) from the 0.17 euros it reported a year ago but were still higher than analysts' expectations for an EPS of 0.13 euros on the back of 6.92 billion euros in sales.
"It looks like a turnaround, but not a rapid one," Jussi Hyoety, a telecom analyst with brokerage FIM Securities, told AFP.
Nokia also said it expected global handset sales to continue to grow and therefore upgraded its sales forecast to 630 million phones by year-end, up from the 600 million units it had previously expected to sell.
For its fourth quarter earnings Nokia took a more cautious stance however, forecasting sales to come in at between 8.4 and 8.6 billion euros, which is slightly less than the 8.8 billion euros it recorded during the same period last year.
The company also foresaw earnings per share of between 0.16 and 0.18 euros, down from the 0.25 euros it made in the October-December quarter a year ago.
In the first half of this year Nokia's results were impeded by its failure to hone in on the popularity of fold-out clamshell phones, currently all the rage among Europeans replacing their old handsets.
The company's many new models as well as price cuts on some older phones have helped to some extent to fill that gap in its portfolio and turn around the drop in market share, the company said.
"I'm pleased that our efforts in product renewal resulted in market share gains in the third quarter in major Western European markets," Jorma Ollila, the group's chief executive, said in a statement.
"With more competitively positioned mobile devices in the replacement market and an attractive offering for rapidly growing markets, Nokia's mobile device volume reached 51.4 million units in the third quarter," he added.
With the global handset volume estimated to be 158 million units in third quarter, Nokia's market share has grown to 33 percent from 31 percent in the previous quarter.
"The market share seems to have gone up quite nicely, so the price cuts have worked," Hyoety said.
Erkki Vesola, telecom analyst at investment bank Mandatum, agreed: "I think the general message was positive."
"Their market share is not falling any more, and in the short-term the situation seems to be safeguarded until the new models come out," he added, referring to the many clam-shell models Nokia has in the pipeline.
The increased volume comes at the expense of profit however, as Nokia was forced to slash prices on several models to claw back lost territory.
The average selling price (ASP) for Nokia's handsets was estimated to be 105 euros in the July-September period, down from 110 euros in the second quarter, which "was disappointing" and reflected improved sales of cheaper phones in emerging markets like Russia, China and India as well, Vesola said.
As a result, the company's mobile phone division turnover was down 13 percent year-on-year to 4.43 billion euros in the third quarter.
At the same time Nokia's network business increased its sales by 21 percent, to 1.47 billion euros, while its multimedia unit saw its revenues grow by 94 percent to 914 million euros.
"Our mobile infrastructure business sales grew markedly in Europe, Latin America and Asia during the quarter as operators continued to expand capacity and coverage," Ollila noted.
Following the release of the results, Nokia's share price remained largely unchanged, increasing only 0.35 percent to 11.45 euros on the Helsinki stock exchange Thursday afternoon.