Nokia does well but frets about China

nokia-in-advanced-talks-to-acquire-alcatel-lucents-wireless-business-reportsFormer rubber wear maker Nokia reported better than expected profits for its telecom network equipment business but warned that its Chinese business might be a bit slow this year.

Nokia’s network gear business, which accounts for more than 90 percent of its stand-alone sales, reported fourth-quarter operating profit margin of 14.6 percent, compared with 14 percent a year earlier.

Net sales for the Nokia group decreased three percent in constant currency terms to $4.08 billion, it said.

Nokia last month started to combine its operations with Alcatel-Lucent, and this week it said it holds 91 percent of Alcatel shares.

Alcatel-Lucent said in a statement that its fourth-quarter adjusted operating profit grew to $632.86 million helped by stronger sales at the end of the year, notably in software.

Revenue over the period rose 13 percent to $7.70 billion.

Catch-up patent payments from Samsung helped Nokia’s total operating profit in the quarter grow 46 percent from a year ago to $829 million, roughly in line with market consensus.

Nokia said it would issue its full-year outlook for the combined networks business in conjunction with its first quarter results. The acquisition is aimed at helping Nokia compete with Ericsson and  Huawei in the network gear market.