Nokia Corp. surprised markets Thursday with a strong first-quarter report of double-digit growth in net profit and sales, and said its global share of mobile phone sales had increased to 35 percent.
The world’s largest cell phone maker said net sales in the period through March 31 grew nearly 30 percent to 9.5 billion euros ($11.73 billion), while net profit was 1.05 billion euros ($1.3 billion), up 21 percent from the same period in 2005.
Markets had expected growth of some 17 percent, and Nokia shares jumped more than 5 percent to 18.35 euros ($22.65) in early afternoon trading in Helsinki.
“This was much better than expected, and Nokia showed strong growth in market share,” said Jussi Hyoty, chief analyst at FIM Securities in Helsinki.
The Finnish company said it sold 75.1 million mobile units in the first quarter — up 40 percent annually — and that its global market share was 35 percent, an increase of 3 percentage points from the previous quarter and 1 percentage point from the same period in 2005.
Nokia’s Chief Executive Jorma Ollila described the results as “excellent ... in a challenging quarter.”
“A robust market coupled with our strong product portfolio and excellent execution produced outstanding results in a seasonally challenging first quarter,” Ollila said.
Nokia’s chief rival, Motorola Inc., on Tuesday reported a slight drop in first-quarter income, but a 23 percent jump in sales that helped it gain market share and close the gap on the Finnish company.
“Motorola is putting up a good fight — the only real challenger to Nokia, while the other smaller players are falling behind,” Hyoty said.
Nokia said it expected that the global mobile market would grow in the second quarter, but that its own share would remain flat.
“This is not bad news. After all, Nokia gave a very strong performance in the first quarter, and its market share surged. A 35-percent share is very respectable,” Hyoty said.
Nokia’s mobile phone sales grew 30 percent in the first quarter to 5.9 million euros ($7.28 million), and sales in North America nearly doubled to 8.4 million euros ($10.4 million).
Nokia predicted that the global mobile market in the full year would be up by 15 percent on its previous estimate of 795 million units in 2005.
Nokia, which is based in Espoo just outside the Finnish capital, has sales in 130 countries and some 62,000 employees — an increase of 3,000 from last year. In 2005, the company’s sales of mobile devices surged 28 percent to a record 265 million units.