Nokia Gains and Looses 2005 4th Qtr

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Nokia has reported net profit for the fourth quarter in line with expectations, but forecast further falls in the selling price of handsets in 2006. Net profit in the quarter had slipped by 1.0 percent to 1.073 billion euros, but that earnings per share had risen to 0.25 euros (0.31 dollars) against 0.24 euros a year earlier.

The group also said that the average selling price for its mobile phones, which has steadily declined, fell to 99 euros in the fourth quarter, from 102 euros in the third quarter and 111 euros in the fourth quarter of 2004.

Nokia's global market share increased by a modest single percentage point to 34 percent in the fourth quarter from 33 percent in the third, which dampened expectations by analysts that Nokia could hit the 40-percent mark this year. Group sales increased by nine percent to 10.33 billion euros overall, and by six percent for the core mobile phone operation alone.

However, sales fell in the networks and enterprise solutions business unit, which builds the infrastructure for mobile phone networks, resulting in a six-percent decline in group operating profit to 1.368 billion euros.

In China, where Nokia is market leader, the company extended its lead over second-placed Motorola, he said. Nokia also unveiled plans to buy back 6.5 billion euros worth of its own shares this year.