BERLIN — Nokia, the world’s largest maker of mobile phones, said Thursday that profit rose 60 percent in the fourth quarter as layoffs, austerity measures and a jump in its share of the smartphone market helped offset a decline in sales.
Nokia also said it expected global industry sales to leap 10 percent this year, signaling a budding recovery in one of the world’s key technology sectors.
The company said it was able to increase its share of the lucrative smartphone market despite stiff competition from the iPhone and Blackberry. Raising the ante with Apple, the Nokia chief executive, Olli-Pekka Kallasvuo, promised new phones with enhanced touch-screen ability this year, and perhaps a tablet computer.
“It was a great performance and Nokia’s best set of handset results since the first half of 2008,” said Neil Mawston, an analyst at Strategy Analytics in London. “Shipments, revenues, average selling prices and margins all exceeded expectations for the quarter.”
Over all, Mr. Mawston said the earnings report suggested “a relatively healthier near-term outlook for Nokia and the overall handset market.”
The financial report painted an upbeat picture for the embattled global industry leader, which had seen its market share begin to slip during 2009 amid gains Research In Motion and Apple, and pressure from Asian rivals like Samsung, LG and HTC.
In the three months through December, Nokia said its profit rose to €882 million, or $1.24 billion, from €551 million a year earlier.
Nokia increased profit as it more than doubled the size of its touchscreen smartphone portfolio. Nokia began selling four new touchscreen smart phones during the quarter in addition to three existing models.
Mr. Kallasvuo said Nokia was working to produce a line of more sophisticated, touchscreen phones that analysts expect will challenge the iPhone. He said it was possible they would be introduced this year when new versions of Nokia’s Symbian and Maemo smartphone operating systems, designed with improved touch screen capability.
“We have a good portfolio but we are currently lagging in the high-end mind-share product,” Mr. Kallasvuo said. “We are definitely working on that one and will come out with that one.”
He also said Nokia was considering making its own tablet-like computing device. Apple’s showed off its tablet, the iPad, on Wednesday.
Mr. Kallasvuo said that Nokia’s experience with its first netbook computer, the Nokia Booklet 3G, “will make us look at the overall tablet markets and markets for other kinds of converged devices. You will see more in this space going forward.”
The convergence of computing and wireless communication technologies contained in smartphones has brought unrelated companies like Apple and Nokia into direct competition. Even so, Mr. Kallasvuo said Nokia and Apple were following different strategies, with Apple focusing on the high-end of the market and Nokia aiming to bring smartphones to the broadest possible spectrum of mobile users.
“Apple continues to be a great competitor, no doubt about that,” Mr. Kallasvuo said. “But we have our assets as well. Our strategy is in democratizing the smartphone in a massive way.”
He disputed the notion put forward Wednesday by the Apple chief executive, Steven P. Jobs, who suggested that Apple, which is now on track to generate $50 billion a year in sales, is a player of equal weight to Nokia in mobile devices. Nokia had sales of €41 billion in 2009.
“We continue to stick to the generally accepted definition of mobility. All devices we make at Nokia have wireless connectivity. By that definition, we are still the largest mobile handset maker,” Mr. Kallasvuo said.
Even so, Nokia is increasingly having to respond to American competitors like Apple and Google, the search engine giant which last year became the first company to give away professional navigation software on mobile devices which run its Android operating system.
Nokia responded last week by announcing plans to give away turn-by-turn professional GPS navigation software on 10 of its smartphone models.
The Finnish company is waging its smartphone offensive as it cuts spending and jobs elsewhere to counter the recession.