Nokia raises 2015 outlook

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Finnish telecom group Nokia has raised its full-year outlook as it posted better-than-expected third quarter earnings, sending the company’s share price soaring by over nine percent.
At a time when operators are postponing or cutting investments in the roll-out of 4G networks amid a challenging economic climate, Nokia has seen strong sales growth in China which has compensated in part for declines in North America and Europe.
Once the world’s top mobile phone maker, Nokia’s main business is now its Networks division.
“While net sales were down slightly year-on-year on a reporting basis, Networks notched one of the highest underline gross margins in our history at 39.5 percent,” Nokia CEO Rajeev Suri said.
The Networks division posted an operating margin of 13.6 percent in the third quarter, up from 13.5 percent a year ago.
For the full-year, that figure is expected to come in “around or slightly below the high end of the long-term range of 8 to 11 percent,” instead of the “midpoint” range previously forecast.
Overall the company’s third quarter attributable net profit dropped to 152 million euros ($166 billion), a fifth of what it was in the same period a year ago, while sales were down two percent to 3.0 billion euros ($3.4 billion).
Suri said it was the Networks results that brightened the picture.
“The performance at Nokia Networks was the highlight of the quarter, and allowed us to raise our full-year outlook for that business,” he said.
Also last week Nokia announced that the French authorities had given a final go-ahead for the acquisition of its French-American rival Alcatel-Lucent, which Nokia expects to conclude in the beginning of 2016.
Nokia’s share price surged 9.38 percent in the first 20 minutes of trading on the Helsinki exchange, and remained around that level at midday in a flat market.
Nokia was the world’s top mobile phone maker between 1998 and 2011 but was overtaken by Samsung after failing to respond to the rapid rise of smartphones.
The Finnish company sold its handset unit to Microsoft in 2014 for some $7.2 billion, which dropped using the Nokia name on Lumia smartphones.

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