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Nokia has record breaking phone sales, average phone price however falls to 89 Euros

January 25, 2007 by Stefan Constantinescu - 1 Comment

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You know … I don’t understand why Nokia’s press release couldn’t have been this thorough. I mean literally all the information people would want to talk about, Reuters covers in this one article:

Robust demand for phones in emerging
markets lifted fourth-quarter sales and profits at Nokia Oyj, the world’s top handset maker, sending its shares
sharply higher.

The Finnish company, which makes more than one in every
three mobile phones sold globally, reported
stronger-than-expected earnings and margins and sales that beat
most analyst expectations.

Nokia’s earnings per share rose to 0.32 euros from 0.25 a
year ago, compared with an average forecast of 0.28 euros in a
Reuters poll of 37 analysts
, where estimates ranged from 0.25
to 0.33 euros. The reported EPS figure included 0.02 euros of
one-off gains, which were not expected by analysts.

Nokia stock rose 5.9 percent after the report to 16.40
euros, valuing the firm at 66 billion euros.

"EPS was clearly better than expected, which is the main
reason why the share is up. The market was also worried about
worse margins for mobile phones, which didn’t materialize,"
Johan Strandberg, Sweden’s SEB Asset Management.

Sales rose 13 percent to 11.7 billion euros ($15.22
billion), beating the analysts’ average projection of 11.57
billion.

Profits at Nokia’s key Mobile Phones unit rose to 1.26
billion euros, at the top end of expectations in the poll.

"The results surprised with their strength, especially the
Mobile Phones unit was better than we had expected, in the
challenging pricing environment," said analyst Karri Rinta from
Handelsbanken.

"Even with the ASP (average selling price) going down,
volumes pushed the profitability up in mobile phones."

PRICES FALL

Nokia said the average sale price of its phones fell to 89
euros
in the three-month period covering Christmas, compared
with analysts’ average expectation of 92 euros and a range from
87 to 95 euros.

Nokia cited strong growth of lower-end products as the main
reason for the lower prices, but in October the company also
cut prices of several more expensive models, like those with
high-quality cameras and music players.

Nokia sold 106 million handsets in the quarter, up 19
percent on a year ago, more than 100 million for the first
time, giving it a market share of 36 percent
, in line with
forecasts. Analysts had forecast sales of 103 million phones.

Nokia proposed to pay a dividend of 0.43 euros per share
for 2006, up from 0.37 euros a year ago.

Its gross margin slipped to 32.4 percent from 34.1 percent,
falling for an 11th consecutive quarter
, but beating the
average of analysts’ forecasts of 31.9 percent.

Source: Reuters

If you’re a statistics nut like me then you’ll want to glance over at this PDF with more data then you can shake a stick at.

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