Nokia has posted profit

Mobile phone maker Nokia has posted better-than-expected profits for the first three months of 2011, down 1% to 344m euros (£304m). But its market share fell 4% to 29% as cheaper rivals and the popularity of competitors' smartphones ate into Nokia's dominance. Nokia also said that it had struck a long-awaited deal to develop smartphone technology with Microsoft. Investors welcomed the news, sending Nokia shares up almost 3%. Stephen Elop, chief executive, said: "In the first quarter, we shifted from defining our strategy to executing our strategy. On this front, I am pleased to report that we signed our definitive agreement with Microsoft and already our product design and engineering work is well underway." The Finnish company's slow response to the smartphone threat from Apple's iPhone and the Blackberry handsets has been one of investors' key concerns. On Wednesday Apple unveiled a 95% rise in first-quarter profits, and said it had sold a record 18.65 million iPhones during the quarter. Consultants Strategy Analytics said that Apple had now overtaken Nokia as the world's largest handset seller in revenue terms.