Nokia reveals hike in profit margin

Nokia’s profitability at its network-equipment business improved in the second quarter as higher-margin software contributed more to sales.

The network unit’s operating margin rose to 11.5 percent from 11 percent a year earlier and 3.2 percent in the previous three months, Espoo, Finlandbased Nokia said Thursday. Morgan Stanley analysts had projected 7.7 percent. Group sales gained 9 percent to 3.2 billion euros ($3.5 billion), compared with the 3.32 billion-euro average of estimates compiled by Bloomberg.

Nokia Chief Executive Officer Rajeev Suri has the balancing act of using acquisitions to boost growth while not giving up profitability. Amid sputtering network-gear demand from wireless carriers and competition from Ericsson and Huawei Technologies, Nokia agreed in April to buy Alcatel-Lucent for 15.6 billion euros, a deal that’s set to double revenue and give Nokia the scale to topple its two main rivals.