The profit was down from a net profit of 380 million euros
in the same period last year, the company said. Revenue grew a mere 1 percent
in the period to 10 billion euros from 9.9 billion euros a year earlier.
Nokia’s overall market share fell to 33 percent in the
quarter 2010, down from 35 percent a year earlier. But it said market share in
the smart phone sector remained at 41 percent — unchanged from the previous
year and the first quarter of 2010, despite strong competition from
iPhone-maker Apple Inc., and Research in Motion Ltd., which makes BlackBerry
handsets.
“Nokia managed to hold onto that market,” said Neil Mawston,
analyst at London-Based Strategy Analytics. “They actually sold 24 million
smart phones, more than our forecasts, and that’s what maybe is helping to
support the shares a little bit.”
Nokia shares were up more than 3 percent at 7.21 euros
($9.26) in afternoon trading in Helsinki.
The company repeated its prediction that the global mobile
market will grow 10 percent this year while its own growth would remain flat.
Nokia said it sold 111 million handsets in the quarter, up 8 percent on 2009.
It also sold a record 24 million smart phones, up 42 percent
on a year earlier.
The company remains the leader in the global mobile market,
with 432 million devices sold last year, more than its three closest rivals
combined, but competition in the smart phone sector was seen as being too much
for the former industry bellwether.
Now, Mawston says, those rivals may be feeling some pressure
as well.
“The challenges are no longer unique to Nokia — they’re
impacting other players in the market ... Blackberry and Apple are also under a
little bit of pressure,” Mawston said. “Despite the iPhone attack, maybe Nokia
isn’t doing quite as badly as everyone thought.”
But the company’s share price has fallen more than 20
percent since the beginning of the year, aided by two profit warnings, and CEO
Olli-Pekka Kallasvuo has come under increasing pressure with speculation that
he will be replaced.
On Thursday, he conceded the rumors were hurting the
company.
“This kind of speculation is not good for Nokia, and in one
way or other we should be able to solve the problem to end the speculation,” he
told Finnish broadcaster YLE.
Nokia has been slow at detecting new trends, like folding
clamshell models and touchscreen handsets, and markets have been expecting
something fresh from the company that once had the innovative edge in the
industry.
That has not happened since Kallasvuo took over in 2006, and
he has also been unable to tackle problems in the North American market, the
company’s worst performer, despite a pledge to make it a top priority.
In the second-quarter, Nokia saw a further 19 percent drop
in sales volumes in North America to a meager 2.6 million units.
Kallasvuo said that models to be launched later this year,
using the Symbian software platform, will “give it broader appeal and reach,
and kick-start Nokia’s fight back at the higher end of the market.”
The average selling price of Nokia handsets continued to
fall in the quarter to euro61, from euro64 in 2009 and euro62 in the first
quarter 2010, while that of smart phones dropped more than 20 percent to
euro143 because of tight competition.
Nokia’s ailing network sector, Nokia Siemens Networks — a
joint venture between Nokia Corp. and Siemens AG of Germany — continued to see
revenue fall, by 5 percent in the quarter to euro3 billion, and the company
gave a poor outlook for the operations during the next quarter.
The company, based in Espoo near Helsinki, employs 129,000
people worldwide.
