Nokia is still losing money

But sales of €5.8bn were 20% lower than last year and 9% lower than expected by analysts polled by Dow Jones Newswires.

"While operating in a highly competitive environment, Nokia is executing its strategy with urgency and managing its costs very well," chief executive Stephen Elop said.

Analysts had anticipated that the company would report a net loss of €434m.

Nokia's devices and services division reported a 32% decline in revenue €2.888bn after it was hit by a 21% volume decline in low-end mobile phones.

The number of smartphones sold fell by 49%, but the sales decline was partially offset by a rise in the average selling price.

Nokia has bet its future on the Lumia smartphone, which aims to rival Apple's high-end iPhone and Samsung's Galaxy.

The company said a 27% volume rise reflected "increasing momentum" for the flagship phone.

Source: AFP via I-Net Bridge