Nokia Corp.'s first-quarter net profit surged to 349 million euros ($467 million) from 122 million euros a year earlier with strong growth in smart phone sales, the company said Thursday.
The world's top mobile phone maker reported that net sales were up 3 percent at 9.5 billion euros in the January to March period, compared with 9.3 billion euros a year earlier.
Markets had been expecting a better result and Nokia stock plunged more than 12 percent to 9.83 euros ($13.15) in early afternoon trading in Helsinki.
CEO Olli-Pekka Kallasvuo said that Nokia's smart phone shipments had performed exceptionally well, growing more than 50 percent year-on-year, but warned of competition from rivals.
"We continue to face tough competition with respect to the high end of our mobile device portfolio, as well as challenging market conditions on the infrastructure side," Kallasvuo said.
The Finland-based company saw handset sales grow 8 percent in the quarter, to 6.7 billion euros, compared to 2009, but said it expects very little increase in the second quarter at some 6.7 billion euros to 7.2 billion euros.
Nokia maintained its forecast that the mobile industry will grow by some 10 percent this year as it emerges from the global downturn but repeated its prediction that its own market share will remain unchanged.
Nokia's networks operations — Nokia Siemens Networks — continued to perform poorly with sales falling nine percent in the quarter to 2.7 billion euros.
Nokia said it sold 108 million handsets in the quarter, up 16 percent on 2009. Smart phone sales surged 57 percent to 21.5 million units.
Nokia's estimated market share was 33 percent, up from 32 percent in 2009 but down from 35 percent in the last quarter of 2009.
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