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Nokia sees growth in profits, handset market

The mobile communications giant reports a surge in earnings and says that the global market for handsets grew during the third quarter.

Mobile communications giant Nokia reported on-target earnings Thursday and said the global handset market grew during the third quarter.

Net profit reached $960 million in the third quarter, up more than one-third from $711 million in the same period last year. However, the Finnish company's revenue slipped to just over $8 billion for the quarter, compared to $8.4 billion in the year-ago period.

Pro forma earnings per share came in at 21 cents for the quarter. That figured matched the consensus estimate from analysts surveyed by First Call.

Nokia blamed the revenue downturn on weakness in the U.S. dollar, given that it sold 23 percent more handsets during the September quarter than in the year-ago quarter, outpacing the growth of the market as a whole. The company said it shipped 45.5 million handsets during the third quarter, out of total market shipments of an estimated 118 million units.

For the year, the company projected that industrywide will reach 460 million. Nokia estimated that its share of the overall mobile phone market rose to 39 percent for the quarter, up from 36 percent in third quarter of last year. The phone maker said it experienced continued strength in Europe, the United States and the Americas, along with growing demand in the Chinese market for GSM (Global System for Mobile Communications) handsets.

Shipments of the company's CDMA (code division multiple access) handsets to China, India and the United States increased during the third quarter, boosting its presence in the global market for that technology, Nokia said.

The company said it also saw evidence of stabilization in its mobile networks business with improved financial performance from its major customers. Nokia said that Western European operators in particular expressed renewed commitment to wireless CDMA during the third quarter.

Nokia also detailed plans to revamp its corporate structure beginning in January 2004, dividing itself into four business units--mobile phones, multimedia, networks and enterprise solutions.