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Nokia Seems To Be Overshooting The Market

Second-quarter earnings were up only slightly year over year. The phone maker admits people aren't buying more-expensive models.
Nokia Corp. offered a dim forecast Thursday for the coming year as it reported disappointing earnings and predicted lower third-quarter sales.

In its second quarter, the Finnish cell-phone maker posted a profit of 624 million euros, or about $699 million, down 28% from profit of 862 million euros a year ago. Sales were up only slightly, reaching 7 billion euros--about $7.8 billion--up from 6.9 billion euros last year.

Nokia blamed the tepid earnings in part on the weak dollar as well as the reluctance of consumers worldwide to buy more-expensive phones. And it expects flat or lower handset sales in the third quarter: Year over year, sales for the quarter could come in down as much as 20%.