Nokia, the Finnish handset giant, announced third quarter financial results yesterday. They've posted an astonishing 85% gain in profits, $2.2 billion, surprising experts and sending their stock into the chilly Scandinavian troposphere. And they did it by playing Wal*Mart to Apple's Neiman-Marcus, if you will -- selling inexpensive things to a lot of people, instead of pricey things to a few people. How many is "a lot," you ask?
The company shipped 112 million units for the quarter, a record for the
industry. Nokia now predicts that 1.1 billion mobile devices will be
sold this year, up from 978 million in 2006. The company's results
follow strong profit reports from mobile-phone rivals LG, Samsung, and
Sony Ericsson in the third quarter. Michael Walkley, a wireless
technology analyst at Piper Jaffray,
says the fact that so many of the handset makers are doing well
underscores the robust demand for mobile phones, even in a relatively
benign pricing environment. Motorola, another top rival, is slated to report results on Oct. 25.
So Nokia has plenty of competition for the low-end market, but they seem to be the only people who know how to make money there. But they'll take one half Apple's iPhone profit margins --with 120 times more sales.