Finnish mobile phone giant Nokia has posted a 61 percent drop in net income for the second quarter on the back of restructuring costs and a slowing market.

Net profit for the quarter came to EUR1.1 billion, compared with EUR2.8 billion last year. Analysts had been expecting profit of EUR1.3 billion. It must be said that profit for the second quarter in 2007 was boosted by a gain from the formation of Nokia Siemens Networks (NSN), the Finnish giant's joint venture with Siemens, while this quarter's bottom line was affected by continuing restructuring costs at NSN and a EUR259 million charge from the closure of a manufacturing plant at Bochum, Germany.

Earnings per share for the quarter were EUR0.20, a 60 percent drop on the year-ago figure. Sales for the three-month period to end of June amounted to EUR13.2 billion, just a 4 percent increase on the year-ago figure of EUR12.6 billion. However, the figure was still ahead of analysts' estimates of EUR12.7 billion. NSN contributed EUR4.1 billion to the Nokia coffers, up 18 percent on the year-ago revenue figure of EUR3.4 billion.

"In the second quarter we saw good momentum in the early stages of our services and software business, and we believe that the next wave of growth will be driven by devices linked with services. On the infrastructure side, Nokia Siemens Networks delivered a second quarter with good net sales growth and improved profitability," said Olli-Pekka Kallasvuo, Nokia CEO.

Nokia said it shipped 122 million mobile phones during the quarter, up 21 percent on the year-ago shipment figure of 100.8 million. According to Nokia it now holds 40 percent of the mobile phone market, up from the 38 percent market share it held in 2007.

The firm said the market share increase was driven primarily by strong share gains in Latin America, Asia-Pacific and a slight increase in North America. This growth offset a slacking off in the Middle East & Africa, Greater China and Europe.