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By Bloomberg

Nokia Oyj returned to profit in the fourth quarter as wireless carriers spent more on expanding and improving networks.

Net income was 443 million euros ($500 million), compared with a loss of 26 million euros a year earlier, the Espoo, Finland-based company said in a statement Thursday. Adjusted earnings per share were 9 cents, compared with the average analyst estimate of 9.5 cents. Sales rose 9.4 percent to 3.8 billion euros, compared with the 3.74 billion euros analysts projected.

Nokia shares are trading at the highest level in almost four years as Chief Executive Officer Rajeev Suri improved profitability by reducing jobs and focusing on more lucrative equipment and service contracts since taking over last May. With the sale of its mobile-phone business to Microsoft Corp., wireless networks and services to carriers -- and competing with Ericsson AB and Huawei Technologies Co. -- have become Nokia’s mainstay business.

The adjusted operating margin at the network unit expanded to 14 percent from 11.2 percent a year earlier. This quarter, that margin will be probably shrink from the fourth quarter, Nokia projected.

In November, the company said that margin for 2015 will be within its long-term target of 8 percent to 11 percent. Nokia at the time also projected rising sales for the network unit and two other divisions.

Shares of Nokia rose 1.1 percent to 7.15 euros yesterday in Helsinki for a market value of 26.8 billion euros.

Outpacing Ericsson

Revenue at the network unit increased 8 percent in the last three months of 2014, supported by demand in Europe and China.

Sweden’s Ericsson, the largest maker of wireless-network equipment, this week reported a 1 percent increase in sales after customers in North America, its largest market and a region in which Nokia is trying to grow, curbed spending on projects.

Nokia is counting on its other two businesses to boost sales and profitability on its path to lifting its debt rating from junk status. The company’s digital-map business provides data to Amazon.com Inc., Microsoft, Yahoo! Inc. and four out of five car-navigation systems. Nokia’s research and development unit collects fees for licensing the company’s patents.