HELSINKI (AP) — Nokia saw fourth quarter profit grow more than 50 percent to 498 million euros ($560 million) on a slight increase in sales, but the telecom networks company cautioned it would face some "market headwinds," especially in China.
The pared-down Finnish company, which sold off HERE mapping services in November after selling its handsets division, didn't say much about the outlook for 2016 except that the first quarter appeared "challenging."
Analysts were disappointed at the scant outlook, and the company stock fell 3 percent to 5.31 euros in early Helsinki trading.
"Nokia didn't really say much about what it expects for the year. There was a slight weakness in sales but that was patched up by the margins, which were good," said Sami Sarkamies, chief analyst at Nordea Bank. "Not many surprises here; the result was much as markets had expected."
Revenue grew 3 percent for continuing operations in the period, to 3.6 billion euros, with strong growth in the technologies sector.
Nokia said it booked a gain of $2.5 billion euros from the sale of its mapping services to leading auto companies, Audi, BMW and Daimler, completed in December and reported it as discontinued operations.
Last year, Nokia became one of world's leading networks providers with a 15.6 billion euro acquisition of ailing French company Alcatel-Lucent. Nokia said Thursday it would hold 91 percent of Alcatel-Lucent's share capital.
Describing 2015 as "another dramatic year of transformation," CEO Rajeev Suri said he was pleased to close the year with "solid performances" from both remaining units — networks and technologies.
Networks, which accounts for 90 percent of total sales, grew 5 percent year-on-year to 3.2 billion euros in the quarter, while the technology unit, which controls the company's vast portfolio of patents, saw sales jump 170 percent in the quarter to 403 million euros.
"While the competitive environment in networks remained generally stable in the fourth quarter, we do expect some market headwinds in 2016 as 4G/LTE rollouts in China and some other markets start to slow," Suri said. "The first quarter, in particular, looks quite challenging."