The world's top mobile phone maker Nokia reported second-quarter profit just below market expectations on Thursday, as rising shipments failed to offset the effect of fierce price competition from its rivals.
Its shares dropped sharply on the news, down 7.5 percent at 13.60 euros.
The Finnish firm posted earnings per share of 0.18 euro, up from 0.15 euro a year ago and saw sales rise 25 percent to 8.1 billion euros ($9.78 billion).
The profit was below the average estimate of 0.19 euro per share in a Reuters poll of 30 analysts but at the top end of Nokia's own forecast for 0.15 to 0.18 euro given in April.
Nokia predicted third-quarter earnings per share would be 0.14 to 0.17 euro versus 0.15 a year ago, on sales of 7.9 to 8.2 billion euros.
Analysts in the poll gave an average third-quarter estimate of 0.20 euro, with sales rising to 8 billion euros.
The company has returned to growth after a stagnant 2004, when gaps in its phone portfolio forced it to cut prices. It has since added several new camera phones and slider models to the line-up, as well as cheaper handsets aimed at fast-growing emerging markets.
The mobile phone market had a brisk April-June, with shipments at Nokia's closest rival Motorola up 40.6 percent year-on-year. Research group Gartner forecasts 16 percent growth in global handset unit shipments in 2005. Source