Nokia, the world’s largest maker of mobile phones, said on Thursday that its profit rose 60 percent in the fourth quarter as cost-cutting measures and an increasing share of the smartphone market helped offset a decline in revenue.
The company also said it expected industry sales to climb 10 percent this year, signaling a budding recovery in one of the world’s main technology sectors.
The company said it was able to increase its share of the lucrative smartphone market despite stiff competition from the iPhone and BlackBerry.
The chief executive, Olli-Pekka Kallasvuo, promised new phones with enhanced touch-screen abilities this year, and perhaps a tablet computer.
The financial report painted an upbeat picture for Nokia, the embattled global industry leader whose market share began to slip in 2009 amid gains by Research In Motion and Apple, and pressure from Asian rivals like Samsung, LG and HTC.
In the three months through December, Nokia said its profit rose to 882 million euros ($1.23 billion) from 551 million euros a year earlier.
Nokia increased profit as it more than doubled the size of its touch-screen smartphone portfolio. Nokia began selling four new touch-screen smartphones during the quarter in addition to three existing models.
Neil Mawston, an analyst at Strategy Analytics in London, said the earnings report suggested “a relatively healthier near-term outlook for Nokia and the overall handset market.”
Mr. Kallasvuo said Nokia was working to produce a line of more sophisticated touch-screen phones to compete with the iPhone.
He said it was possible that the phones would be introduced this year along with new versions of Nokia’s Symbian and Maemo smartphone operating systems, offering improved touch-screen capability.
“We have a good portfolio but we are currently lagging in the high-end mind-share product,” Mr. Kallasvuo said. “We are definitely working on that one and will come out with that one.”
He also said Nokia was considering making its own tabletlike computing device. Apple introduced its iPad tablet on Wednesday.
“Apple continues to be a great competitor, no doubt about that,” Mr. Kallasvuo said. “But we have our assets as well. Our strategy is in democratizing the smartphone in a massive way.”
Nokia is increasingly having to respond to American competitors like Apple and Google, the search engine giant that last year became the first company to give away professional navigation software on mobile devices that run its Android operating system.
Nokia last week announced plans to give away turn-by-turn professional GPS navigation software on 10 of its smartphone models.
The company, based in Finland, is waging its smartphone offensive as it reduces spending and eliminates jobs to counter the recession.
During the fourth quarter, Nokia cut research and development spending by 9 percent, to 1.6 billion euros, and sales and marketing expenses by 18 percent, to 1.05 billion euros. General administrative expenses fell 15 percent, to 294 million euros.
Nokia eliminated 2,276 jobs, or 1.8 percent of its work force, last year.
The savings resulted in the latest profit increase even as revenue fell to 12 billion euros, from 12.7 billion euros in the previous quarter.
Nokia said its leading share of the global smartphone market rose to 40 percent in the quarter from an estimated 35 percent at the end of September. The company’s share of the overall cellphone market rose to 39 percent, from 38 percent in September.
Strong growth in China, Asia, Africa and the Middle East offset declines in North America, South America and Europe.
Nokia reported sales of 126.9 million phones in the fourth quarter, 12 percent more than a year earlier.
The company said it sold 52.4 million smartphones in the quarter, up from 47 million a year ago. Sales of the more expensive devices, which combine features of a phone and a computer, helped lift the average selling price for all Nokia handsets to 63 euros, from 62 euros in September.
News Source:- http://www.nytimes.com/
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