Nokia reported a smaller than expected fall in third quarter profits on Thursday, boosted by strong sales of simple cell phone models.

Nokia reported third quarter underlying earnings per share of 0.03 euros, compared with a loss of 0.01 euros in a Reuters poll of analysts and a profit of 0.14 euros a year ago.

The following are analysts reactions to the news.

CAROLINA MILANESI, RESEARCH VP GARTNER

It is positive because it is kind of sticking with what we were expecting. You can't expect miracles in the short term, they have the devices that they have. But they are in my view addressing the problems. The dual SIM was a huge void for them. They have addressed that and they are being successful with those devices.

We didn't see a continued loss in share, and that is good of course. Smartphones are the thing that remains weak. It is hard for operators to buy into Symbian ... because there is basically an expiry date for how long Symbian will be around.

RICHARD WINDSOR, GLOBAL TECHNOLOGY ANALYST AT NOMURA INTERNATIONAL:

You've a bit of a relief rally going on here. There were some concerns that things would continue to be difficult for Q4, but they've raised expectations a little bit in terms of the margin outlook, which has given some people confidence that things are not getting any worse.

You have the potential positive catalyst of Nokia World on 26 Oct, where they'll talk about Windows and will probably launch some devices.

You have basically got a steady quarter, cash balance is going to get a bit better. so you're seeing people hoping that they've finally hit the bottom.

GREGER JOHANSSON, REDEYE

Volumes are clearly better in Q3 than expected, which drive sales and profits. It's better on the phone-side in Q3, which is what is most positive.

On the other hand it's mainly cheap phones they have sold in large volumes. But it's positive and explains why the shares are up. Margin guidance for devices in Q4 of 1-4 percent is perhaps a little better than consensus.

Today's report was a good piece of news, but the big battle is when their Windows-phones will be out, if they are good or bad.

LEE SIMPSON, ANALYST AT JEFFERIES & CO:

The report card would say C+. Margin guidance is decent, if in line, we have a poor read on NSN (Nokia Siemens), but what catches our eye is ASP's are dropping faster than expected. However they have caught market share this quarter -- volumes are up quite considerably, in the low end at least.

I think the structural issues are still here. They've reaffirmed their position at the expense of ASPs. It's an OK set of results by their standards.

JARI HONKO, SWEDBANK

The results were clearly better than expected. The mobile phones volumes shipped had the biggest role, also the smart phone volumes were on a higher level than expected.

It seems that Nokia is further into a recovery, or rebound, than had been expected. Fourth quarter guidance signals that this trend will continue.

Markets have not believed that Nokia could climb up from the bottom.

FRANCISCO JERONIMO, IDC:

Nokia results announced today show how painful the transition has been from Symbian to Windows Phones. Despite the investment on making Symbian more attractive, the new versions of Symbian Anna and Symbian Belle are not helping Nokia in any way. Consumers and mobile operators are looking forward to see the new Windows Phones. For most mobile operators in Europe, it is completely pointless to support a 'ghost' operating system. They want Windows Phones and that is what Nokia needs to deliver next week at Nokia World in London. Failing to deliver the Windows Phones this year puts Nokia in a very dangerous position on the market.

MIKAEL RAUTANEN, INDERES

Dual SIM phones saved the quarterly profit, volumes were clearly above expectations. It is also positive that it seems they managed to stop the smart phone collapse.

An important message was that the devices unit operating profit remains positive through the fourth quarter.

THOMAS LANGER, WEST LB

It's pretty much in line with what we had expected, also regarding Q4.

I think that it's maybe a stronger finish to the year than some expected, but the real test will happen during 2012. And this is the reason why we remain skeptics of the stock. I think investors are falling into a valuation trap.

GEOFF BLABER, CCS INSIGHT:

Device & Services performance was ahead of expectations. Whilst the storm clouds haven't parted, operational improvement combined with positive news at Nokia World next week will raise confidence for 2012.

The decline in ASP reveals quite how aggressively Nokia competed to deliver shipments ahead of expectations but crucially, the positive operating margin demonstrates a parallel improvement in operational efficiency.

(Compiled by Stockholm newsroom, reporting by Terhi Kinnunen, Paul Sandle, Tarmo Virki, Jussi Rosendahl, Olof Swahnberg and Simon Johnson.)

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