Nokia slashes margin targets

Handset leader Nokia cut its operating margin targets, blaming increased exposure to the network infrastructure business, an Associated Press report said.

The Associated Press report also quoted as the company as predicting that global sales of mobile phones would grow by 10% in 2007.

Nokia said its closely watched operating margin will suffer from the start of the Nokia Siemens Networks operations, a joint venture that will combine Nokia's network business group and Siemens' carrier-related operations, the report said.

As a result, it lowered its target margin to 15% for the next one to two years, down from the 17% it set in December 2005, the report further said.

Nokia also tightened targets for its mobile phone and multimedia division, saying it would aim for a 17% operating margin over the next two years rather than the 17% to 18% set out last December.

Nokia meanwhile said industry-wide shipments of mobile phones will be up 10 % next year from the 970 million units it estimates will be sold in 2006.