Nokia shares surged on Friday, as it reported a profit that will make it one of the world’s biggest companies.
In its earnings report, Nokia reported an 8.4 per cent rise in profit, beating Wall Street expectations and boosting its stock price.
The company reported a net profit of $2.1 billion, or $0.19 per share, and beat analysts’ forecasts for a profit of 3 cents per share.
Nokia’s stock surged by 1.5 per cent to $3.12 per share in early trade.
Analysts expected the Finnish phone maker to report a loss of 3.5 cents per cent, but it was actually better than analysts’ expectations, which was 3 cents.
The stock jumped to $2,813 per share after analysts’ estimates.
Wall Street was looking for Nokia to report profit of about 3 cents a share.
Analytics firm Sanford C. Bernstein said the profit was a better performance than expected given that Nokia is looking to expand its mobile business in the US and Asia, where the company has strong brands.
Analytically, analysts were expecting a profit less than the 3.4 cents Nokia reported, but analysts’ predictions were for a 3.8 per cent profit.
Nomura analyst Yannis Mavrosatos predicted a profit in the region of 3 cent.
The firm said that Nokia had also improved its cash position, having a cash position of $1.5 billion compared to the $1 billion that analysts had expected.
The company also posted a profit, despite the company’s weak third quarter profit.
The company said it would cut costs, but this could only happen if the market was healthy and Nokia had a strong balance sheet.
The Nokia shares are up almost $10 per share since mid-October.
The shares have rallied more than 8 per cent this year.
Read moreThe results come after Nokia announced it would reduce the number of employees at its global headquarters by about half to 3,200, from 5,800.
The move comes after Nokia, which also has a major business in Europe, saw a 30 per cent fall in the number, or revenue, of sales in the second quarter of 2016.
The loss in the third quarter was also more than expected, according to analysts.
Nokia said the cuts were in line with the restructuring plan, which is aimed at reducing its costs.
