Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Ruffian who wrote (36753)	7/22/1999 10:12:00 AM
From: Michael	Read Replies (3) \| Respond to of 152472

Nokia reports strong sales growth> bloomberg.com Top Financial News Thu, 22 Jul 1999, 9:35am EDT Nokia Boosts 2nd-Quarter Profit 59%, Says Full-Year Sales May Beat Target By Jonas Dromberg Nokia Second-Quarter Profit Rises 59% on Phone Sales (Update3) (Rewrites fourth paragraph.) Helsinki, July 22 (Bloomberg) -- Nokia Oyj, the world's largest cellular phone maker, said second-quarter profit rose 59 percent as new phones helped it maintain an edge over rivals Motorola Inc. and Ericsson AB. The Finnish company's profit rose to 581 million euros ($610 million), or 0.49 euros a diluted share, from 365 million, or 0.31 a share, in the year-earlier period. Analysts expected 580 million euros. Still, the stock fell as much as 5.8 percent because a 58 percent increase in phone sales was below estimates. ''The success can't go on forever,'' said Edward Werner, a portfolio manager at Banque Baumann et Cie. SA in Luxembourg. ''At some point everyone will have a mobile phone and there are more players coming into the market.'' Nokia last year passed Motorola as the world leader after unveiling a range of new cellular phones. Analysts expect demand to continue after Nokia last month released the 3210 series phone. Beating the competition with its sleek products, Nokia is benefiting from a surge in U.S. and European demand, pushing the stock up more than fivefold since the beginning of last year. Today, shares in Europe's sixth biggest company by market value fell as much as 5.15 euros to 83.60. Werner said he might buy the shares if they decline further. Market to Triple Nokia has 23 percent of the global market, according to market researcher Dataquest. Motorola has 20 percent, while Sweden's Ericsson AB has 15 percent. The Helsinki-based company expects the market will triple to 1 billion subscribers by 2003. Worldwide sales of cellular phones rose 51 percent to 163 million units last year. The cellular phone unit saw operating profit rise 105 percent to 671 million euros, while sales in the unit rose 58 percent to 2.922 billion euros. Some analysts expected sales to rise as much as 85 percent. ''Expectations were very high for the phone unit,'' said Sami Sarkamaa, an analyst at Evli Securities. Sales growth for the full-year may exceed the company's earlier target of 25 percent to 35 percent, Chief Executive Jorma Ollila. In the first quarter, Ericsson's mobile phone sales declined 12 percent, the third consecutive quarterly decline, while Motorola's rose 8 percent in the period. Ericsson's earnings are due tomorrow. Nokia said it estimates there was 375 million cellular phone subscribers in June. It also said 40 percent of the phones sold were sold to existing subscribers, who upgrade their phones to a newer model. Network Expansion In the network unit, operating profit rose 13 percent to 274 million euros as sales rose 31 percent to 1.390 billion. ''As phones are more important than networks at Nokia, the growth surprise in networks failed to compensate for phones,'' said Evli's Sarkamaa. Operating margin, a measure of profitability, rose to 23.0 percent from 17.7 percent in the phone unit, while it fell to 19.7 percent from 22.9 percent in the network unit. Total sales rose to 4.493 billion euros from 3.098 billion, while operating profit rose to 881 million euros from 563 million. At the same time, Nokia said its 7110 series phone will start selling this quarter, raising concern it will come out later than in August, as previously announced. The 7110 phone will be the first phone to use the Wireless Application Protocol, or WAP, a next generation feature that allows users to access designated Internet sites. Earlier this year, Nokia introduced a WAP server and the WAP browser in an attempt to make WAP services more accessible. ''We expect a number of WAP compliant products and services to be launched later this year, and in line with our intent, we are at the forefront of this development,'' said Nokia. Pretax profit rose to 877 million euros from 546 million. Analysts were looking for profit before tax of 884 million euros.