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Nokia Reports Major Q4, Annual Sales, Profit Gains

Helsinki, Finland — Nokia reported increased fourth-quarter and annual net sales and profits, with mobile phones posting double-digit gains for both time periods.

For the quarter, ended Dec. 31, net sales were $15.2 billion, up 13 percent from $13.4 billion in the previous year. Mobile phone sales rose 14 percent to $9.2 billion, from $6.2 billion in the fourth quarter of 2005.

Operating profit for the entire company was $1.97 billion in the quarter, up from the previous year’s $1.77 billion, an 11 percent gain. Mobile phone profit for the quarter was up 19 percent to $1.63 billion from the previous year’s $1.38 billion.

For the year, net sales were up 20 percent to $53.5 billion with Nokia’s mobile phone sales at $32.2 billion, an increase of 19 percent. Annual operating profit reached $7.14 billion for the entire company, a gain of 18 percent. Annual operating profit for mobile phones was up 14 percent during the year, reaching $5.33 billion.

Olli-Pekka Kallasvuo, Nokia CEO, said in a prepared statement, “I am very pleased with Nokia’s excellent quarterly. We achieved record device volumes, net sales and EPS for both the fourth quarter and full year 2006. Also, on a sequential basis profitability improved significantly, with gross margins for the quarter up in all Nokia business groups.”

He added, “Nokia was able to increase its share of the global device market significantly in 2006 to an estimated 36 percent, clearly solidifying our number one position in the industry. We achieved this result through the strengths of Nokia’s world class brand, products, cost structure and efficiency, without sacrificing our operating margins or cash flow.”

Nokia reported that the combined mobile device volume of its mobile phones, multimedia and enterprise solutions business groups for the fourth quarter 2006 was a record 106 million units, up 19 percent sequentially and 26 percent year-on-year. Nokia’s own converged device volumes for the fourth quarter 2006 grew to 11.1 million units, compared with 9.3 million units in the fourth quarter 2005. Almost 6 million Nokia Nseries multimedia computers were shipped in the fourth quarter.

In North America Nokia shipped 12.5 million mobile devices during the fourth quarter, up 33 percent from the previous quarter’s 9.4 million units.