“Shares of Nokia Corp. fell as much as 10% Thursday after the world’s largest maker of mobile phones reported a smaller-than-expected 25% increase in first-quarter profit and forecast the mobile-phone market to shrink in euro terms this year,” Aude Lagorce reports for Dow Jones.

“Nokia’s net profit in the three months ended March 31 improved to 1.22 billion euros, or 0.32 euro a share, from 979 million euros, or 0.25 euro a share, earned in the year-ago first quarter. The profit missed consensus forecasts calling for earnings of 1.38 billion euros, according to a survey of 29 analysts conducted by FactSet,” Lagorce reports.

“Excluding one-time costs for pensions and the closure of a plant, the latest quarter’s earnings came in at 0.38 euro a share. Sales rose 28% to 12.7 billion euros, in line with expectations,” Lagorce reports. “Nokia’s shares were last down 10% in early afternoon trading in Helsinki.”

“Analysts at Citigroup recently expressed concern about a lack of major products in the second quarter. The company has said it won’t launch a touch-screen riposte to Apple Inc. and its high-end iPhone until the second half of the year, and it’s yet to give a firm date,” Lagorce reports. “Nokia Chief Executive Olli-Pekka Kallasvuo on Thursday brushed off suggestions that Nokia needs to do more to fight back the foray of iPhone onto its home turf, calling it a ‘niche product.'”

Full article here.

MacDailyNews Take: Kallasvuo is either incapable of applying the lessons of iPod to iPhone and understanding what’s coming his way or, much more likely, he understands perfectly and, since he has no answer, is saying just what many now-defunct (if they aren’t making iPod accessories) MP3-makers said a few years ago. How many “niche” products have $100 million venture capital funds ready and waiting, exactly? Candybars and way-too-late, fake 1st generation iPhones with craptastic UI’s aren’t going to cut it from here on out, Nokia boy. This June, the bloodbath really begins, and Kallasvuo sounds like he knows it.