Nokia Corporation reported a 61% drop in Q2 net profit due in large part to restructuring costs and the effects of a global economic slowdown.

However, CEO Olli-Pekka Kallasvuo said Nokia’s market share increased to 40% during the quarter and predicted industry sales will climb by at least 10% this year. Later this year, Nokia plans to introduce touchscreen phones that should put it in contention with other touchscreen handset makers like Apple, LG and Samsung.

Net sales for the handset maker increased 4% to $20.9 billion, while net profit was $1.7 billion, down 61% from the same quarter in 2007. The group’s operating profit fell 38% to $2.3 billion compared to Q2 2007, including costs for the closure of its Bochum, Germany, plant.

Nokia’s Q2 sales of mobile phones increased by 21% over last’s year’s Q2 figures reaching 122 million devices.

The group said it sold 36.4 million units in Asia-Pacific, 27.1 million units in Europe, 21.1 million units in the Middle East and Africa and 17.6 million units in China. North American sales increased 9%.

In related company news, the joint venture of Nokia Siemens Networks (NSN) posted an operating loss of $74 million for Q2, while its net sales increased 18% to $6.5 billion year-on-year. Meanwhile, NSN also announced that it had sealed a deal with Telefonica O2 to expand, modernize and maintain its mobile network. Terms of the deal weren’t immediately available.