Nokia stocks took a heavy beating for failing to meet forecast

It was the week when Nokia admitted the first effects of the economic slowdown and its CEO warned that the industry worldwide would be hit by poor economic conditions. Shares in the Finnish handset giant fell 13% after it said it expected the global device market to shrink in value for the first time this year.

Nokia reported a net profit of $1.9 billion in the first three months of the year, 25% more than $1.6 billion in the same period in 2007 but below analyst forecasts. Revenue grew 28% to $20 billion from $15.6 billion a year earlier, with strong growth of handsets sales in Asia, the Middle East and Africa.

Markets had been expecting a better result: A Factset analyst poll cited by Dow Jones Newswires forecast a 42 % rise in profit.

Nokia's market share slipped from 40% in the October-to-December quarter to 39% in the first quarter this year. But it sold 115 million mobile devices in the first quarter, up 27 % from a year earlier, and its market share was 3 points higher than in the first quarter a year ago.

Source : Nokia PR