2007-04-19 12:00:00 CEST
2007-04-19 12:00:00 CEST
REGULATED INFORMATION
Nokia - Quarterly report
Nokia reports Q1 2007 net sales of EUR 9.9 billion and EPS of EUR 0.25
Profitability strong for the quarter - driven by a sequential increase in gross
margin
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| | NOKIA IN THE FIRST QUARTER 2007 |
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| EUR million | Q1/2007* | Q1/2006** | Change % |
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| Net sales | 9 856 | 9 507 | 4 |
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| Mobile Phones | 5 583 | 5 869 | -5 |
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| Multimedia | 2 252 | 1 758 | 28 |
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| Enterprise Solutions | 326 | 186 | 75 |
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| Networks | 1 697 | 1 699 | 0 |
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| Operating profit | 1 272 | 1 367 | -7 |
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| Mobile Phones | 936 | 1 085 | -14 |
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| Multimedia | 424 | 323 | 31 |
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| Enterprise Solutions | -38 | -66 | |
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| Networks | 78 | 149 | -48 |
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| Common Group Expenses | -128 | -124 | |
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| Operating margin (%) | 12.9 | 14.4 | |
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| Mobile Phones (%) | 16.8 | 18.5 | |
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| Multimedia (%) | 18.8 | 18.4 | |
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| Enterprise Solutions (%) | -11.7 | -35.5 | |
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| Networks (%) | 4.6 | 8.8 | |
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| Net profit | 979 | 1 048 | -7 |
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| EPS, EUR | | | |
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| Basic | 0.25 | 0.25 | |
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| Diluted | 0.25 | 0.25 | |
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*Q1 2007 special items:
- EUR 32 million restructuring charges (EUR 17 million impacting Enterprise
Solutions operating loss, EUR 10 million impacting Mobile Phones operating
profit, EUR 3 million impacting Multimedia operating profit, and EUR 2 million
included in Common Group Expenses).
- EUR 25 million charge related to restructuring of a subsidiary company
(impacting Mobile Phones operating profit)
- EUR 12 million charge for Nokia Siemens Networks related incremental costs
expensed during the first quarter (impacting Networks operating profit).
- Excluding the net impact of these special items, diluted EPS was EUR 0.26.
**Q1 2006 special items:
- EUR 14 million initial restructuring charge for the CDMA business in Mobile
Phones.
- EUR 8 million restructuring charge in Enterprise Solutions.
- Both of these charges impacted operating profit.
- The net impact of these special items on diluted EPS was negligible.
FIRST QUARTER 2007 HIGHLIGHTS
- Estimated industry device volumes of 253 million units, down 13% sequentially
and up 18% year on year.
- Nokia device volumes of 91.1 million units, down 14% sequentially and up 21%
year on year.
- Nokia estimated device market share 36%, at the same level as Q4 2006 and up
from 35% in Q1 2006.
- Nokia device ASP of EUR 89, at the same level as Q4 2006.
- Nokia gross margin of 33.1%, up sequentially from 32.4% in Q4 2006.
- Nokia operating margin of 13.6%, up sequentially from 13.3% in Q4 2006,
excluding special items.
- Nokia diluted EPS of EUR 0.26 excluding special items.
- Nokia operating cash flow of EUR 1.6 billion.
- Multimedia and Enterprise Solutions net sales strong, up sequentially from Q4
2006.
- Key products started shipping: Nokia 6300, Nokia N95 and Nokia E65.
OLLI-PEKKA KALLASVUO, NOKIA CEO:
“I'm encouraged by Nokia's first quarter 2007 performance. Our profitability was
strong, with both gross and operating margins up sequentially, excluding special
items. We also saw good year on year device volume growth that led to an
increase in our market share, further solidifying our number one position in the
industry.
Our Multimedia business group achieved record net sales and operating margin in
a seasonally challenging environment. Multimedia continues to lead in the
convergence space, with close to eight million Nokia Nseries devices shipped
during the quarter, including the ground-breaking Nokia N95 multimedia computer.
Our Enterprise Solutions business group showed improved results, bolstered by
sales of the new Nokia E65, and we are targeting break even for Enterprise
Solutions in the second quarter 2007. Mobile Phones mid-range portfolio was
strengthened by the Nokia 6300, which began initial shipments in the first
quarter.
We're excited that Nokia Siemens Networks started operations on April 1, 2007.
We believe that this new company will have the scale, portfolio and innovation
to assume a leading position in the communications infrastructure market.”
INDUSTRY AND NOKIA OUTLOOK FOR THE SECOND QUARTER AND FULL YEAR 2007
- Nokia expects industry mobile device volumes in the second quarter 2007 to be
slightly up sequentially.
- We expect Nokia's device market share in the second quarter 2007 to be
approximately at the same level sequentially.
- Nokia continues to expect industry mobile device volumes in 2007 to grow by up
to 10% from the approximately 978 million units Nokia estimates for 2006.
- Nokia continues to expect the device industry to experience value growth in
2007, but expects some decline in industry ASPs, primarily reflecting the
increasing impact of the emerging markets and competitive factors in general.
- Nokia continues to target an increase in its market share in mobile devices in
2007.
- Nokia continues to expect very slight market growth for the mobile and fixed
infrastructure and related services market in euro terms in 2007.
Q1 2007 FINANCIAL HIGHLIGHTS
(Comparisons are given to the first quarter 2006 results, unless otherwise
indicated.)
Nokia Group
Nokia's first quarter 2007 net sales increased 4% to EUR 9.9 billion, compared
with EUR 9.5 billion in the first quarter 2006. At constant currency, group net
sales would have increased 6%.
Nokia's first quarter 2007 operating profit decreased 7% to EUR 1 272 million
(including the negative impact of EUR 69 million in special items), compared
with EUR 1 367 million in the first quarter 2006 (including the negative impact
of EUR 22 million in special items). Nokia's first quarter 2007 operating margin
was 12.9% (14.4%) including the impact of the respective special items, and
13.6% (14.6%) excluding the special items.
Operating cash flow for the first quarter 2007 was EUR 1.6 billion, compared
with EUR 1.0 billion for the first quarter 2006, and total combined cash and
other liquid assets at March 31, 2007 were EUR 9.1 billion, compared with
EUR 8.5 billion at December 31, 2006. At March 31, 2007, our net debt-equity
ratio (gearing) was -72%, compared with -68% at December 31, 2006.
Mobile devices
In the first quarter 2007, the total mobile device volume achieved by our Mobile
Phones, Multimedia and Enterprise Solutions business groups reached 91.1 million
units, representing 21% year on year growth and a 14% sequential decrease. The
overall industry volume for the same period reached an estimated 253 million
units, representing 18% year on year growth and a 13% sequential decrease.
Converged device industry volumes increased to an estimated 23.5 million units,
compared with an estimated 17 million units in the first quarter 2006. Nokia's
own converged device volumes rose to 11.8 million units, compared with 8.5
million units in the first quarter 2006. Nokia shipped close to eight million
Nokia Nseries and more than one million Nokia Eseries devices during the first
quarter 2007.
The following chart sets out Nokia's mobile device volumes for the periods
indicated, as well as the year on year and sequential growth rates by geographic
area.
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| NOKIA MOBILE DEVICE VOLUME BY GEOGRAPHIC AREA |
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| (million units) | Q1 2007 | Q1 2006 | YoY | Q4 2006 | QoQ |
| | | | Change | | Change |
| | | | (%) | | (%) |
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| Europe | 23.9 | 20.4 | 17.7 | 33.3 | -28.3 |
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| Middle East & Africa | 15.7 | 11.9 | 31.8 | 15.5 | 1.3 |
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| China | 15.7 | 10.9 | 43.4 | 14.6 | 7.8 |
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| Asia-Pacific | 23.7 | 16.4 | 44.7 | 23.7 | 0.3 |
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| North America | 4.8 | 8.4 | -42.5 | 5.9 | -19.0 |
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| Latin America | 7.3 | 7.1 | 2.4 | 12.5 | -41.8 |
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| Total | 91.1 | 75.1 | 21.4 | 105.5 | -13.7 |
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Based on our preliminary market estimate, Nokia's market share for the first
quarter 2007 was 36%, compared with 35% in the first quarter 2006 and 36% in the
fourth quarter 2006. Nokia's year on year market share increase was driven
primarily by strong gains in Asia-Pacific and Europe that more than offset a
significant market share decline in North America. Year on year market share was
approximately at the same level in China, Latin America and Middle East &
Africa. Sequentially, Nokia's market share was approximately at the same level
as in fourth quarter 2006, globally as well as in each geographic area. The
sequential decline in first quarter industry volumes was similar to previous
years, however we believe there has been an impact in the market from the excess
inventory of certain of our competitors' products.
Nokia's average selling price in the first quarter 2007 was EUR 89, down from
EUR 103 in the first quarter 2006 and at the same level as in the fourth quarter
2006. The lower year on year ASP in the first quarter 2007 was primarily the
result of a significantly higher proportion of entry-level device sales, where
the industry growth especially in the emerging markets has been strong and where
Nokia's share has been growing. In addition, certain ageing higher end products
in our portfolio were viewed as less competitive in various markets.
Sequentially, first quarter 2007 ASPs were impacted by a higher percentage of
entry-level device sales. That sequential development was offset by strong sales
of our higher ASP devices, particularly from the Multimedia business group.
Business Groups
Mobile Phones: First quarter 2007 net sales decreased 5% to EUR 5.6 billion,
compared with EUR 5.9 billion in the first quarter 2006. Strong overall volume
growth was not enough to offset a significant ASP decline year on year, driven
primarily by a higher proportion of entry-level sales. Net sales decreased in
all regions except Asia-Pacific. Net sales were down significantly in North
America and to a lesser degree in Latin America, Middle East & Africa, Europe
and China.
Mobile Phones reported operating profit in the first quarter 2007 decreased 14%
to EUR 936 million, compared with EUR 1.1 billion in the first quarter 2006,
with an operating margin of 16.8% (18.5%). Reported first quarter 2007 operating
profit included total charges of EUR 35 million, of which EUR 25 million was
related to the restructuring of a subsidiary company and EUR 10 million was
mainly related to restructuring in Customer and Market Operations. First quarter
2006 reported operating profit included a EUR 14 million initial restructuring
charge for the CDMA business. Operating profit for the first quarter 2007
excluding the charges was EUR 971 million, with an operating margin of 17.4%
(18.7%). The decrease in operating profit for the first quarter 2007, excluding
the special items, was primarily caused by lower sales of higher end, higher
margin devices, and an increase in sales and marketing expenses, compared to the
first quarter 2006.
Multimedia: First quarter 2007 net sales increased 28% to EUR 2.3 billion,
compared with EUR 1.8 billion in the first quarter 2006. Net sales increased
year on year in all regions except North America, where net sales continued at a
low level. Multimedia net sales year on year growth was fastest in Latin America
and China. Net sales growth was driven by high volumes of Nokia Nseries
multimedia computers, especially the Nokia N73 and Nokia N70, combined with a
stable ASP year on year.
Multimedia reported operating profit in the first quarter 2007 grew 31% to
EUR 424 million, compared with EUR 323 million in the first quarter 2006, with
an operating margin of 18.8% (18.4%). Reported first quarter 2007 operating
profit in Multimedia included restructuring charges of EUR 3 million. Operating
profit for the first quarter 2007 excluding these charges was EUR 427 million,
with an operating margin of 19.0%. Operating profit growth in the first quarter
2007 was driven by strong net sales growth and effective operating cost control,
compared to the first quarter 2006.
Enterprise Solutions: First quarter 2007 net sales increased 75% to EUR 326
million, compared with EUR 186 million in the first quarter 2006. Net sales
increased year on year in all regions except North America and China, where net
sales decreased. Enterprise Solutions net sales more than doubled year on year
in Europe, Latin America and Asia-Pacific. Net sales were positively impacted by
strong year on year volume growth of the Nokia Eseries.
In the first quarter 2007, Enterprise Solutions had a reported operating loss of
EUR 38 million, compared with a reported operating loss of EUR 66 million in the
first quarter 2006. The reported first quarter 2007 operating loss included
restructuring charges of EUR 17 million. Excluding these charges, the operating
loss for the first quarter 2007 was EUR 21 million. The reported first quarter
2006 operating loss included a EUR 8 million restructuring charge. The
significantly improved operating performance for the first quarter 2007,
excluding these charges, reflected strong net sales growth and effective
operating cost control compared to the first quarter 2006.
Networks: First quarter 2007 net sales of EUR 1.7 billion was at the same level
as the first quarter 2006. Net sales increased significantly in Middle East &
Africa and to a lesser extent in Asia Pacific, China and Europe. Net sales
declined significantly year on year in North America and to a lesser extent in
Latin America.
Networks reported operating profit in the first quarter 2007 decreased 48% to
EUR 78 million, compared with EUR 149 million in the first quarter 2006, with an
operating margin of 4.6% (8.8%). Reported first quarter 2007 operating profit
included a charge of EUR 12 million related to Nokia Siemens Networks
incremental costs expensed during the quarter. Operating profit for the first
quarter 2007 excluding these charges was EUR 90 million, with an operating
margin of 5.3%. The decrease in operating profit in the first quarter 2007 was
primarily caused by a greater proportion of sales from the emerging markets, a
higher share of services sales, and continued pricing pressure in the industry.
Q1 2007 OPERATING HIGHLIGHTS
Mobile Phones
- First shipments of the slim and stylish Nokia 6300.
- Announcement of the Nokia 6110 Navigator, an HSDPA (High Speed Downlink Packet
Access) device with GPS (Global Positioning System) and AGPS (Assisted Global
Positioning System).
- Announcement of the Nokia 6131 NFC phone, the world's first fully integrated,
commercial NFC (Near Field Communications) handset. It enables information
sharing, service initiation, and payment and ticketing capability with a single
tap of the device.
- Expansion of Nokia's music phone offering with the Nokia 5700 XpressMusic (a
3G converged device with a dedicated audio chip, iconic twist design, music
player, 2 megapixel camera and video calling), and the Nokia 5070 (with
integrated FM radio, a VGA camera, pre-installed java games and a built in web
browser).
- The enhancement of the popular L'Amour collection with the introduction of the
Nokia 7373 Special Edition in two contemporary colors paired with signature
Giambattista Valli phone accessories; and the first CDMA model in the L'Amour
Collection, the Nokia 7088.
- Introduction of the Nokia 3110 classic, a triband GSM phone in a robust and
durable design with a 1.3 megapixel camera, music player with expandable memory,
and an FM stereo radio.
Multimedia
- Product launches included the Nokia N76, Nokia N93i, Nokia N77 and Nokia N800
multimedia computers, including features such as DVB-H for mobile TV, DVD
like-quality video, music players and touch screen functionality.
- First shipments of the Nokia N95, featuring connectivity over GPS, HSDPA and
WLAN.
- Nokia announced the availability of the smart2go mapping and navigation
platform for the most popular mobile operating systems. The platform allows for
mapping and routing in more than 150 countries and has support for full
turn-by-turn satellite navigation in more than 30 countries.
- Nokia announced new games, publishers and developers for its new N-Gage mobile
gaming platform. These new developments will help to bring connected mobile
gaming experiences to millions of Nokia mobile device owners worldwide starting
in September 2007.
- Nokia announced cooperation with YouTube that allows people to enjoy YouTube
videos on the go via Nokia Nseries devices. Nokia also announced cooperation
with Six Apart to make it easy for people to upload video and photos, and update
their blogs directly from their compatible Nokia Nseries devices to the Vox
blogging service.
Enterprise Solutions
- Second generation Nokia Eseries products - Nokia E61i, Nokia E65 and Nokia E90
Communicator - were launched at the 3GSM World Congress in February.
- The launch of Intellisync Mobile Suite 8.0, the first major update to the
Intellisync platform since the Intellisync acquisition, with several major
feature and performance enhancements including a powerful new email experience
for S60 devices.
Networks
- As announced during Q1 2007, Nokia Siemens Networks started operations on
April 1, 2007. Nokia and Siemens also announced that they would increase their
respective net asset contributions to Nokia Siemens Networks, with Siemens to
contribute EUR 2.4 billion and Nokia to contribute EUR 1.7 billion. From April
1, 2007, the financial results of Nokia Siemens Networks will be consolidated to
Nokia. Nokia is in the process of evaluating the net assets acquired and expects
to finalize the purchase price allocation and to realize a gain on this
transaction in the second quarter 2007.
- At the 3GSM World Congress in Barcelona, Nokia Siemens Networks outlined its
vision of 5 billion people connected and 'always on' by 2015, and unveiled a
proposed product portfolio plan that will play a key role in helping customers
meet the needs of these billions of future subscribers.
- Nokia and Siemens Networks and NEC Corporation announced they had signed a
Memorandum of Understanding for co-operation in the area of WCDMA radio
networks. Nokia said that it will expand its 3G radio access multi-operator
solution to enable the sharing of a radio access network between as many as four
operators.
- Nokia won a deal with U.S. Sprint Nextel to become a key infrastructure and
consumer electronic device provider for the operator's 4G WiMAX next generation
mobility network. Nokia was later awarded the four Texas markets of Dallas, Fort
Worth, San Antonio and Austin for the initial build-out of Sprint Nextel's
mobile WiMAX network.
- Nokia's won services deals in the quarter include network expansion and
managed services extension contracts from Telenor Pakistan and 3GIS Sweden, and
a WCDMA and GSM managed services contract from T-Mobile in the Netherlands.
Nokia also said it would provide hosted mobile email to Wind in Italy.
- Nokia announced contracts with four new customers in the quarter, winning a 3G
network deal with Romania's RCS & RDS; a GSM/EDGE network and managed services
contract with new Slovenian operator Tusmobil; a GSM and GPRS network deal with
Telefónica Móviles Panamá; and a core network deal with television broadcaster
Cyfrowy Polsat, which is entering the Polish telecom market as an MVNO.
For more information on the operating highlights mentioned above, please refer
to related press announcements, which can be accessed at:
http://www.nokia.com/press.
NOKIA IN THE FIRST QUARTER 2007
(International Financial Reporting Standards (IFRS) comparisons given to the
first quarter 2006 results, unless otherwise indicated.)
Nokia's net sales increased 4% to EUR 9 856 million (EUR 9 507 million). Net
sales of Mobile Phones decreased by 5% to EUR 5 583 million (EUR 5 869 million).
Net sales of Multimedia increased by 28% to EUR 2 252 million (EUR 1 758
million). Net sales of Enterprise Solutions increased by 75% to EUR 326 million
(EUR 186 million). Net sales of Networks remained at the same level, EUR 1 697
million (EUR 1 699 million).
Operating profit decreased by 7% to EUR 1 272 million (EUR 1 367 million),
representing an operating margin of 12.9% (14.4%). Operating profit in Mobile
Phones decreased 14% to EUR 936 million (EUR 1 085 million), representing an
operating margin of 16.8% (18.5%). Operating profit in Multimedia increased by
31% to EUR 424 million (EUR 323 million), representing an operating margin of
18.8% (18.4%). Enterprise Solutions reported an operating loss of EUR 38 million
(operating loss of EUR 66 million). Operating profit in
Networks decreased 48% to EUR 78 million (EUR 149 million), representing an
operating margin of 4.6% (8.8%). Common Group expenses totaled EUR 128 million
(EUR 124 million).
Financial income was EUR 48 million (EUR 74 million). Profit before tax and
minority interests was EUR 1 325 million (EUR 1 445 million). Net profit totaled
EUR 979 million (EUR 1 048 million). Earnings per share was EUR 0.25 (basic) and
EUR 0.25 (diluted), compared to EUR 0.25 (basic) and EUR 0.25 (diluted) in the
first quarter 2006.
PERSONNEL
The average number of employees from January to March 2007 was 68 418. At March
31, 2007, Nokia employed a total of 68 321 people (68 483 people at December 31,
2006).
SHARES AND SHARE CAPITAL
On March 31, 2007, Nokia and its subsidiary companies owned 174 417 543 Nokia
shares. The shares had an aggregate par value of EUR 10 465 052.58, representing
approximately 4.3% of all the shares of the company and of the total voting
rights. The total number of shares on March 31, 2007 was 4 095 042 619 and the
share capital was EUR 245 702 557.14. Nokia announced on March 29, 2007 that it
had decided to cancel 169 500 000 Nokia shares held by the company. The
cancellation was effected on April 4, 2007, reducing the total number of shares
correspondingly.
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| | | | | | | | |
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| Q1 2007 BY BUSINESS GROUP, EUR | | | | | |
| million | | | | | |
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| (unaudited) | | | | | | | |
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| | Mobil | Multim | Enterp | Networ | Common | Elimin | Group |
| | e | edia | rise | ks | Group | a-tion | |
| | Phone | | Soluti | | Functio | s | |
| | s | | ons | | ns | | |
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| Net sales | 5 583 | 2 252 | 326 | 1 697 | | -2 | 9 856 |
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| Gross profit | 1 683 | 841 | 145 | 584 | 9 | | 3 262 |
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| Gross margin, | 30.1 | 37.3 | 44.5 | 34.4 | | | 33.1 |
| % | | | | | | | |
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| Research and | -282 | -221 | -67 | -284 | -71 | | -925 |
| development | | | | | | | |
| expenses | | | | | | | |
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| % of net sales | 5.1 | 9.8 | 20.6 | 16.7 | | | 9.4 |
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| Selling and | -402 | -173 | -74 | -131 | -9 | | -789 |
| marketing | | | | | | | |
| expenses | | | | | | | |
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| % of net sales | 7.2 | 7.7 | 22.7 | 7.7 | | | 8.0 |
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| Administrative | -21 | -13 | -24 | -74 | -41 | | -173 |
| and general | | | | | | | |
| expenses | | | | | | | |
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| % of net sales | 0.4 | 0.6 | 7.4 | 4.4 | | | 1.8 |
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| Other | -42 | -10 | -18 | -17 | -16 | | -103 |
| operating | | | | | | | |
| income and | | | | | | | |
| expenses | | | | | | | |
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| Operating | 936 | 424 | -38 | 78 | -128 | | 1 272 |
| profit | | | | | | | |
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| Operating | 16.8 | 18.8 | -11.7 | 4.6 | | | 12.9 |
| margin, % | | | | | | | |
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| | | | | | | | |
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| Q1 2006 BY BUSINESS GROUP, EUR | | | | | |
| million | | | | | |
--------------------------------------------------------------------------------
| (unaudited) | | | | | | | |
--------------------------------------------------------------------------------
| | Mobil | Multim | Enterp | Networ | Common | Elimin | Group |
| | e | edia | rise | ks | Group | a-tion | |
| | Phone | | Soluti | | Functio | s | |
| | s | | ons | | ns | | |
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| Net sales | 5 869 | 1 758 | 186 | 1 699 | | -5 | 9 507 |
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| Gross profit | 1 809 | 703 | 86 | 620 | 6 | | 3 224 |
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| Gross margin, | 30.8 | 40.0 | 46.2 | 36.5 | | | 33.9 |
| % | | | | | | | |
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| Research and | -304 | -215 | -76 | -285 | -66 | | -946 |
| development | | | | | | | |
| expenses | | | | | | | |
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| % of net sales | 5.2 | 12.2 | 40.9 | 16.8 | | | 10.0 |
--------------------------------------------------------------------------------
| Selling and | -362 | -147 | -53 | -121 | -5 | | -688 |
| marketing | | | | | | | |
| expenses | | | | | | | |
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| % of net sales | 6.2 | 8.4 | 28.5 | 7.1 | | | 7.2 |
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| Administrative | -19 | -10 | -18 | -57 | -61 | | -165 |
| and general | | | | | | | |
| expenses | | | | | | | |
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| % of net sales | 0.3 | 0.6 | 9.7 | 3.4 | | | 1.7 |
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| Other | -39 | -8 | -5 | -8 | 2 | | -58 |
| operating | | | | | | | |
| income and | | | | | | | |
| expenses | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating | 1 085 | 323 | -66 | 149 | -124 | | 1 367 |
| profit | | | | | | | |
--------------------------------------------------------------------------------
| Operating | 18.5 | 18.4 | -35.5 | 8.8 | | | 14.4 |
| margin, % | | | | | | | |
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| | | | | | | | |
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| NOKIA NET SALES BY GEOGRAPHIC AREA, EUR million | | |
--------------------------------------------------------------------------------
| (unaudited) | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | | 1-3/2007 | Y-o-Y | 1-3/2006 | | 1-12/200 |
| | | | | change, % | | | 6 |
--------------------------------------------------------------------------------
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| Europe | | | 3 669 | 8 | 3 393 | | 15 587 |
--------------------------------------------------------------------------------
| Middle-East & | | 1 414 | 10 | 1 290 | | 5 277 |
| Africa | | | | | | |
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| China | | | 1 429 | 13 | 1 261 | | 5 361 |
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| Asia-Pacific | | 2 228 | 17 | 1 902 | | 8 361 |
--------------------------------------------------------------------------------
| North America | | 447 | -52 | 934 | | 2 970 |
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| Latin America | | 669 | -8 | 727 | | 3 565 |
--------------------------------------------------------------------------------
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| Total | | | 9 856 | 4 | 9 507 | | 41 121 |
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| | | | | | | | |
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| NOKIA PERSONNEL BY GEOGRAPHIC AREA | | | |
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| | | | 31.03.07 | Y-o-Y | 31.03.06 | Q-o-Q | 31.12.20 |
| | | | | change, % | | change, | 06 |
| | | | | | | % | |
--------------------------------------------------------------------------------
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| Europe | | | 39 491 | 5 | 37 546 | | 39 306 |
--------------------------------------------------------------------------------
| Middle-East & | | 1 073 | 133 | 461 | 5 | 1 021 |
| Africa | | | | | | |
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| China | | | 7 577 | 18 | 6 395 | 2 | 7 452 |
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| Asia-Pacific | | 9 683 | 51 | 6 392 | -2 | 9 868 |
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| North America | | 5 234 | -19 | 6 432 | -6 | 5 574 |
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| Latin America | | 5 263 | -5 | 5 537 | | 5 262 |
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| Total | | | 68 321 | 9 | 62 763 | | 68 483 |
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| | | | | | | | |
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| CONSOLIDATED PROFIT AND LOSS ACCOUNT, IFRS, EUR | | |
| million | | |
--------------------------------------------------------------------------------
| (unaudited) | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 1-3/2007 | 1-3/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
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| Net sales | 9 856 | 9 507 | 41 121 |
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| Cost of sales | -6 594 | -6 283 | -27 742 |
--------------------------------------------------------------------------------
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| Gross profit | 3 262 | 3 224 | 13 379 |
--------------------------------------------------------------------------------
| Research and development expenses | -925 | -946 | -3 897 |
--------------------------------------------------------------------------------
| Selling and marketing expenses | -789 | -688 | -3 314 |
--------------------------------------------------------------------------------
| Administrative and general expenses | -173 | -165 | -666 |
--------------------------------------------------------------------------------
| Other income | 53 | 52 | 522 |
--------------------------------------------------------------------------------
| Other expenses | -156 | -110 | -536 |
--------------------------------------------------------------------------------
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| Operating profit | 1 272 | 1 367 | 5 488 |
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| Share of results of associated | 5 | 4 | 28 |
| companies | | | |
--------------------------------------------------------------------------------
| Financial income and expenses | 48 | 74 | 207 |
--------------------------------------------------------------------------------
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| Profit before tax | 1 325 | 1 445 | 5 723 |
--------------------------------------------------------------------------------
| Tax | -337 | -381 | -1 357 |
--------------------------------------------------------------------------------
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| Profit before minority interests | 988 | 1 064 | 4 366 |
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| Minority interests | -9 | -16 | -60 |
--------------------------------------------------------------------------------
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| Profit attributable to equity holders | 979 | 1 048 | 4 306 |
| of the parent | | | |
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| | | | |
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| Earnings per share, EUR | | | |
--------------------------------------------------------------------------------
| (for profit attributable to the | | | |
| equity holders of the parent) | | | |
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| Basic | 0.25 | 0.25 | 1.06 |
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| Diluted | 0.25 | 0.25 | 1.05 |
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| Average number of shares (1 000 | | | |
| shares) | | | |
--------------------------------------------------------------------------------
| Basic | 3 949 539 | 4 150 295 | 4 062 833 |
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| Diluted | 3 978 525 | 4 162 182 | 4 086 529 |
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| | | | |
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| Depreciation and amortization, total | 173 | 189 | 712 |
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| Share-based compensation expense, | 48 | 29 | 192 |
| total | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED BALANCE SHEET, IFRS, EUR million | | |
| (unaudited) | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ASSETS | 31.03.2 | 31.03.200 | 31.12.2006 |
| | 007 | 6 | |
--------------------------------------------------------------------------------
| Non-current assets | | | |
--------------------------------------------------------------------------------
| Capitalized development costs | 263 | 259 | 251 |
--------------------------------------------------------------------------------
| Goodwill | 527 | 411 | 532 |
--------------------------------------------------------------------------------
| Other intangible assets | 287 | 267 | 298 |
--------------------------------------------------------------------------------
| Property, plant and equipment | 1 583 | 1 602 | 1 602 |
--------------------------------------------------------------------------------
| Investments in associated companies | 231 | 194 | 224 |
--------------------------------------------------------------------------------
| Available-for-sale investments | 269 | 272 | 288 |
--------------------------------------------------------------------------------
| Deferred tax assets | 807 | 828 | 809 |
--------------------------------------------------------------------------------
| Long-term loans receivable | 18 | 7 | 19 |
--------------------------------------------------------------------------------
| Other non-current assets | 8 | 6 | 8 |
--------------------------------------------------------------------------------
| | 3 993 | 3 846 | 4 031 |
--------------------------------------------------------------------------------
| Current assets | | | |
--------------------------------------------------------------------------------
| Inventories | 1 577 | 1 738 | 1 554 |
--------------------------------------------------------------------------------
| Accounts receivable | 5 781 | 5 279 | 5 888 |
--------------------------------------------------------------------------------
| Prepaid expenses and accrued income | 2 284 | 2 211 | 2 496 |
--------------------------------------------------------------------------------
| Other financial assets | 110 | 123 | 111 |
--------------------------------------------------------------------------------
| Available-for-sale investments, liquid | 6 110 | 6 117 | 5 012 |
| assets | | | |
--------------------------------------------------------------------------------
| Available-for-sale investments, cash | 1 650 | 1 272 | 2 046 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Bank and cash | 1 325 | 1 646 | 1 479 |
--------------------------------------------------------------------------------
| | 18 837 | 18 386 | 18 586 |
--------------------------------------------------------------------------------
| Total assets | 22 830 | 22 232 | 22 617 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY AND LIABILITIES | | | |
--------------------------------------------------------------------------------
| Capital and reserves attributable to | | | |
| equity holders of the parent | | | |
--------------------------------------------------------------------------------
| Share capital | 246 | 266 | 246 |
--------------------------------------------------------------------------------
| Share issue premium | 2 766 | 2 510 | 2 707 |
--------------------------------------------------------------------------------
| Treasury shares | -2 818 | -4 995 | -2 060 |
--------------------------------------------------------------------------------
| Translation differences | -70 | 33 | -34 |
--------------------------------------------------------------------------------
| Fair value and other reserves | 17 | -106 | -14 |
--------------------------------------------------------------------------------
| Retained earnings 1) | 12 113 | 12 859 | 11 123 |
--------------------------------------------------------------------------------
| | 12 254 | 10 567 | 11 968 |
--------------------------------------------------------------------------------
| Minority interests | 66 | 217 | 92 |
--------------------------------------------------------------------------------
| Total equity | 12 320 | 10 784 | 12 060 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current liabilities | | | |
--------------------------------------------------------------------------------
| Long-term interest-bearing liabilities | 70 | 22 | 69 |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 205 | 163 | 205 |
--------------------------------------------------------------------------------
| Other long-term liabilities | 122 | 99 | 122 |
--------------------------------------------------------------------------------
| | 397 | 284 | 396 |
--------------------------------------------------------------------------------
| Current liabilities | | | |
--------------------------------------------------------------------------------
| Short-term borrowing | 103 | 322 | 247 |
--------------------------------------------------------------------------------
| Accounts payable | 3 818 | 3 643 | 3 732 |
--------------------------------------------------------------------------------
| Accrued expenses 1) | 3 766 | 4 719 | 3 796 |
--------------------------------------------------------------------------------
| Provisions | 2 426 | 2 480 | 2 386 |
--------------------------------------------------------------------------------
| | 10 113 | 11 164 | 10 161 |
--------------------------------------------------------------------------------
| Total shareholders' equity and | 22 830 | 22 232 | 22 617 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 173 | 344 | 316 |
--------------------------------------------------------------------------------
| Shareholders' equity per share, EUR | 3.13 | 2.58 | 3.02 |
--------------------------------------------------------------------------------
| Number of shares (1 000 shares) 2) | 3 920 | 4 087 981 | 3 965 730 |
| | 625 | | |
--------------------------------------------------------------------------------
| 1) Dividends to Nokia shareholders, EUR 1 512 million in 2006, | |
| were booked as a liability | |
--------------------------------------------------------------------------------
| at the end of the first quarter. Cash flow impact | | |
| was shown in the second quarter 2006. | | |
--------------------------------------------------------------------------------
| 2) Shares owned by Group companies are | | | |
| excluded. | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED CASH FLOW STATEMENT, IFRS, EUR million | | |
--------------------------------------------------------------------------------
| (unaudited) | | | |
--------------------------------------------------------------------------------
| | 1-3/2007 | 1-3/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
| Cash flow from operating activities | | | |
--------------------------------------------------------------------------------
| Profit attributable to equity holders of | 979 | 1 048 | 4 306 |
| the parent | | | |
--------------------------------------------------------------------------------
| Adjustments, total | 521 | 533 | 1 857 |
--------------------------------------------------------------------------------
| Profit attributable to equity holders of | 1 500 | 1 581 | 6 163 |
| the parent before change in net working | | | |
| capital | | | |
--------------------------------------------------------------------------------
| Change in net working capital | 367 | -281 | -793 |
--------------------------------------------------------------------------------
| Cash generated from operations | 1 867 | 1 300 | 5 370 |
--------------------------------------------------------------------------------
| Interest received | 74 | 48 | 235 |
--------------------------------------------------------------------------------
| Interest paid | -16 | -4 | -18 |
--------------------------------------------------------------------------------
| Other financial income and expenses, net | -36 | 36 | 54 |
| received | | | |
--------------------------------------------------------------------------------
| Income taxes paid | -248 | -413 | -1 163 |
--------------------------------------------------------------------------------
| Net cash from operating activities | 1 641 | 967 | 4 478 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from investing activities | | | |
--------------------------------------------------------------------------------
| Acquisition of Group companies, net of | - | -315 | -517 |
| acquired cash | | | |
--------------------------------------------------------------------------------
| Purchase of current available-for-sale | -1 731 | -973 | -3 219 |
| investments, liquid assets | | | |
--------------------------------------------------------------------------------
| Purchase of non-current available-for-sale | -7 | -25 | -88 |
| investments | | | |
--------------------------------------------------------------------------------
| Purchase of shares in associated companies | -5 | -6 | -15 |
--------------------------------------------------------------------------------
| Additions to capitalized development costs | -38 | -34 | -127 |
--------------------------------------------------------------------------------
| Long-term loans made to customers | - | - | -11 |
--------------------------------------------------------------------------------
| Proceeds from repayment and sale of | - | 56 | 56 |
| long-term loans receivable | | | |
--------------------------------------------------------------------------------
| Recovery of impaired long-term loans made | - | - | 276 |
| to customers | | | |
--------------------------------------------------------------------------------
| Proceeds from (+), payment of (-) other | 1 | - | -3 |
| long-term loans receivable | | | |
--------------------------------------------------------------------------------
| Proceeds from (+), payment of (-) | -23 | 75 | 199 |
| short-term loans receivable | | | |
--------------------------------------------------------------------------------
| Capital expenditures | -123 | -149 | -650 |
--------------------------------------------------------------------------------
| Proceeds from disposal of shares in | - | - | 1 |
| associated companies | | | |
--------------------------------------------------------------------------------
| Proceeds from maturities and sale of | 618 | 1 685 | 5 058 |
| current available-for-sale investments, | | | |
| liquid assets | | | |
--------------------------------------------------------------------------------
| Proceeds from sale of non-current | 12 | - | 17 |
| available-for-sale investments | | | |
--------------------------------------------------------------------------------
| Proceeds from sale of fixed assets | 19 | 7 | 29 |
--------------------------------------------------------------------------------
| Net cash from investing activities | -1 277 | 321 | 1 006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from financing activities | | | |
--------------------------------------------------------------------------------
| Proceeds from stock option exercises | - | 6 | 46 |
--------------------------------------------------------------------------------
| Purchase of treasury shares | -758 | -1 379 | -3 371 |
--------------------------------------------------------------------------------
| Proceeds from long-term borrowings | - | 2 | 56 |
--------------------------------------------------------------------------------
| Repayment of long-term borrowings | - | - | -7 |
--------------------------------------------------------------------------------
| Proceeds from (+), payment of (-) | -114 | -51 | -137 |
| short-term borrowings | | | |
--------------------------------------------------------------------------------
| Dividends paid | -37 | - | -1 553 |
--------------------------------------------------------------------------------
| Net cash used in financing activities | -909 | -1 422 | -4 966 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Foreign exchange adjustment | -5 | -6 | -51 |
--------------------------------------------------------------------------------
| Net increase (+)/decrease (-) in cash and | -550 | -140 | 467 |
| cash equivalents | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at beginning of | 3 525 | 3 058 | 3 058 |
| period | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at end of period | 2 975 | 2 918 | 3 525 |
--------------------------------------------------------------------------------
| NB: The figures in the consolidated cash flow statement cannot be directly |
| traced from the balance sheet |
--------------------------------------------------------------------------------
| without additional information as a result of acquisitions and disposals of |
| subsidiaries and net foreign |
--------------------------------------------------------------------------------
| exchange differences arising on | | | |
| consolidation. | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY, IFRS, EUR | |
| million | |
--------------------------------------------------------------------------------
| (unaudited) | | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Sha | Shar | Tre | Tran | Fair | Retai | Befor | Minor | Tota |
| | re | e | asu | slat | valu | ned | e | ity | l |
| | cap | issu | ry | ion | e | earni | minor | inter | equi |
| | ita | e | sha | diff | and | ngs | ity | est | ty |
| | l | prem | res | eren | othe | | | | |
| | | ium | | ce | r | | | | |
| | | | | | rese | | | | |
| | | | | | rves | | | | |
--------------------------------------------------------------------------------
| Balance at | 266 | 2 | -3 | 69 | -176 | 13 | 12 | 205 | 12 |
| December 31, | | 458 | 616 | | | 308 | 309 | | 514 |
| 2005 | | | | | | | | | |
--------------------------------------------------------------------------------
| Tax benefit | | 17 | | | | | 17 | | 17 |
| on stock | | | | | | | | | |
| options | | | | | | | | | |
| exercised | | | | | | | | | |
--------------------------------------------------------------------------------
| Translation | | | | -34 | | | -34 | | -34 |
| differences | | | | | | | | | |
--------------------------------------------------------------------------------
| Net | | | | -2 | | | -2 | | -2 |
| investment | | | | | | | | | |
| hedge losses | | | | | | | | | |
--------------------------------------------------------------------------------
| Cash flow | | | | | 86 | | 86 | | 86 |
| hedges, net | | | | | | | | | |
| of tax | | | | | | | | | |
--------------------------------------------------------------------------------
| Available-fo | | | | | -16 | | -16 | | -16 |
| r-sale | | | | | | | | | |
| investments, | | | | | | | | | |
| net of tax | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | 15 | 15 | -2 | 13 |
| increase, | | | | | | | | | |
| net | | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | | 1 048 | 1 048 | 16 | 1 |
| | | | | | | | | | 064 |
--------------------------------------------------------------------------------
| Total recognized | | | | | | | | |
| income and | | | | | | | | |
--------------------------------------------------------------------------------
| expense | - | 17 | - | -36 | 70 | 1 063 | 1 114 | 14 | 1 |
| | | | | | | | | | 128 |
--------------------------------------------------------------------------------
| Stock | | 6 | | | | | 6 | | 6 |
| options | | | | | | | | | |
| exercised | | | | | | | | | |
--------------------------------------------------------------------------------
| Share-based | | 29 | | | | | 29 | | 29 |
| compensation | | | | | | | | | |
--------------------------------------------------------------------------------
| Acquisition | | | -1 | | | | -1 | | -1 |
| of treasury | | | 380 | | | | 380 | | 380 |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Reissuance | | | 1 | | | | 1 | | 1 |
| of treasury | | | | | | | | | |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | | -1 | -1 | -2 | -1 |
| | | | | | | 512 | 512 | | 514 |
--------------------------------------------------------------------------------
| Total other | - | 35 | -1 | - | - | -1 | -2 | -2 | -2 |
| equity | | | 379 | | | 512 | 856 | | 858 |
| movements | | | | | | | | | |
--------------------------------------------------------------------------------
| Balance at | 266 | 2 | -4 | 33 | -106 | 12 | 10 | 217 | 10 |
| March 31, | | 510 | 995 | | | 859 | 567 | | 784 |
| 2006 | | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance at | 246 | 2 | -2 | -34 | -14 | 11 | 11 | 92 | 12 |
| December 31, | | 707 | 060 | | | 123 | 968 | | 060 |
| 2006 | | | | | | | | | |
--------------------------------------------------------------------------------
| Tax benefit | | -1 | | | | | -1 | | -1 |
| on stock | | | | | | | | | |
| options | | | | | | | | | |
| exercised | | | | | | | | | |
--------------------------------------------------------------------------------
| Excess tax | | 15 | | | | | 15 | | 15 |
| benefit on | | | | | | | | | |
| share-based | | | | | | | | | |
| compensation | | | | | | | | | |
--------------------------------------------------------------------------------
| Translation | | | | -52 | | | -52 | - | -52 |
| differences | | | | | | | | | |
--------------------------------------------------------------------------------
| Net | | | | 16 | | | 16 | | 16 |
| investment | | | | | | | | | |
| hedge | | | | | | | | | |
| losses, net | | | | | | | | | |
| of tax | | | | | | | | | |
--------------------------------------------------------------------------------
| Cash flow | | | | | 20 | | 20 | | 20 |
| hedges, net | | | | | | | | | |
| of tax | | | | | | | | | |
--------------------------------------------------------------------------------
| Available-fo | | | | | 11 | | 11 | | 11 |
| r-sale | | | | | | | | | |
| investments, | | | | | | | | | |
| net of tax | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | 11 | 11 | 2 | 13 |
| increase, | | | | | | | | | |
| net | | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | | 979 | 979 | 9 | 988 |
--------------------------------------------------------------------------------
| Total | - | 14 | - | -36 | 31 | 990 | 999 | 11 | 1 |
| recognized | | | | | | | | | 010 |
| income and | | | | | | | | | |
| expense | | | | | | | | | |
--------------------------------------------------------------------------------
| Stock | | -1 | | | | | -1 | | -1 |
| options | | | | | | | | | |
| exercised | | | | | | | | | |
| related | | | | | | | | | |
| acquisitions | | | | | | | | | |
--------------------------------------------------------------------------------
| Share-based | | 46 | | | | | 46 | | 46 |
| compensation | | | | | | | | | |
--------------------------------------------------------------------------------
| Acquisition | | | -76 | | | | -760 | | -760 |
| of treasury | | | 0 | | | | | | |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Reissuance | | | 2 | | | | 2 | | 2 |
| of treasury | | | | | | | | | |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | | - | - | -37 | -37 |
--------------------------------------------------------------------------------
| Total of | - | 45 | -75 | - | - | - | -713 | -37 | -750 |
| other equity | | | 8 | | | | | | |
| movements | | | | | | | | | |
--------------------------------------------------------------------------------
| Balance at | 246 | 2 | -2 | -70 | 17 | 12 | 12 | 66 | 12 |
| March 31, | | 766 | 818 | | | 113 | 254 | | 320 |
| 2007 | | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| COMMITMENTS AND CONTINGENCIES, EUR | | | |
| million | | | |
--------------------------------------------------------------------------------
| (unaudited) | | | |
--------------------------------------------------------------------------------
| | | GROUP | |
--------------------------------------------------------------------------------
| | 31.03.07 | 31.03.06 | 31.12.2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Collateral for own commitments | | | |
--------------------------------------------------------------------------------
| Property under mortgages | 18 | 18 | 18 |
--------------------------------------------------------------------------------
| Assets pledged | 27 | 28 | 27 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Contingent liabilities on behalf of | | | |
| Group companies | | | |
--------------------------------------------------------------------------------
| Other guarantees | 341 | 308 | 358 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Contingent liabilities on behalf of | | | |
| other companies | | | |
--------------------------------------------------------------------------------
| Financial guarantees on behalf of third | 28 | - | 23 |
| parties | | | |
--------------------------------------------------------------------------------
| Other guarantees | 2 | 2 | 2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Leasing obligations | 614 | 635 | 665 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financing commitments | | | |
--------------------------------------------------------------------------------
| Customer finance commitments | 161 | 13 | 164 |
--------------------------------------------------------------------------------
| Venture fund commitments | 266 | 224 | 208 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NOTIONAL AMOUNTS OF DERIVATIVE FINANCIAL INSTRUMENTS, EUR | |
| million 1) | |
--------------------------------------------------------------------------------
| (unaudited) | | | |
--------------------------------------------------------------------------------
| | 31.03.07 | 31.03.06 | 31.12.2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Foreign exchange forward contracts 2) | 30 702 | 34 950 | 29 859 |
--------------------------------------------------------------------------------
| Currency options bought 2) | 896 | 400 | 404 |
--------------------------------------------------------------------------------
| Currency options sold 2) | 234 | 163 | 193 |
--------------------------------------------------------------------------------
| Interest rate swaps and futures | - | 4 400 | - |
--------------------------------------------------------------------------------
| Cash settled equity options 3) | 44 | 150 | 45 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Includes the gross amount of all | | | |
| notional values for contracts that have | | | |
| not yet been settled or cancelled. The | | | |
| amount of notional value outstanding is | | | |
| not necessarily a measure or indication | | | |
| of market risk, as the exposure of | | | |
| certain contracts may be offset by that | | | |
| of other contracts. | | | |
--------------------------------------------------------------------------------
| 2) Notional amounts include contracts | | | |
| used to hedge the shareholders' equity | | | |
| of foreign subsidiaries. | | | |
--------------------------------------------------------------------------------
| 3) Cash settled equity options can be | | | |
| used to hedge risks relating to | | | |
| incentive programs and investment | | | |
| activities. | | | |
--------------------------------------------------------------------------------
| 1 EUR = 1.331 USD | | | |
--------------------------------------------------------------------------------
It should be noted that certain statements herein which are not historical
facts, including, without limitation, those regarding: A) the timing of product
and solution deliveries; B) our ability to develop, implement and commercialize
new products, solutions and technologies; C) expectations regarding market
growth, developments and structural changes; D) expectations regarding our
mobile device volume growth, market share, prices and margins; E) expectations
and targets for our results of operations; F) the outcome of pending and
threatened litigation; and G) statements preceded by “believe,” “expect,”
“anticipate,” “foresee,” “target,” “estimate,” “designed,” “plans,” “will” or
similar expressions are forward-looking statements. These statements are based
on management's best assumptions and beliefs in light of the information
currently available to it. Because they involve risks and uncertainties, actual
results may differ materially from the results that we currently expect. Factors
that could cause these differences include, but are not limited to: 1)
competitiveness of our product portfolio; 2) our ability to identify key market
trends and to respond timely and successfully to the needs of our customers; 3)
the extent of the growth of the mobile communications industry, as well as the
growth and profitability of the new market segments within that industry which
we target; 4) the availability of new products and services by network operators
and other market participants; 5) our ability to successfully manage costs; 6)
the intensity of competition in the mobile communications industry and our
ability to maintain or improve our market position and respond successfully to
changes in the competitive landscape; 7) the impact of changes in technology and
our ability to develop or otherwise acquire complex technologies as required by
the market, with full rights needed to use; 8) timely and successful
commercialization of complex technologies as new advanced products and
solutions; 9) our ability to protect the complex technologies, which we or
others develop or that we license, from claims that we have infringed third
parties' intellectual property rights, as well as our unrestricted use on
commercially acceptable terms of certain technologies in our products and
solution offerings; 10) our ability to protect numerous Nokia patented,
standardized, or proprietary technologies from third party infringement or
actions to invalidate the intellectual property rights of these technologies;
11) our ability to manage efficiently our manufacturing and logistics, as well
as to ensure the quality, safety, security and timely delivery of our products
and solutions; 12) inventory management risks resulting from shifts in market
demand; 13) our ability to source quality components and sub-assemblies without
interruption and at acceptable prices; 14) Nokia's and Siemens' ability to
successfully integrate the operations, personnel and supporting activities of
their respective businesses as a result of the merger of Nokia's networks
business and Siemens' carrier-related operations for fixed and mobile networks
forming Nokia Siemens Networks; 15) whether, as a result of investigations into
alleged violations of law by some current or former employees of Siemens,
government authorities or others take actions against Siemens and/or its
employees that may involve and affect the carrier-related assets and employees
transferred by Siemens to Nokia Siemens Networks, or there may be undetected
additional violations that may have occurred prior to the transfer, or ongoing
violations that may occur after the transfer, of such assets and employees that
could result in additional actions by government authorities; 16) the expense,
time, attention and resources of Nokia Siemens Networks and our management to
detect, investigate and resolve any situations related to alleged violations of
law involving the assets and employees of Siemens carrier-related operations
transferred to Nokia Siemens Networks; 17) any impairment of Nokia Siemens
Networks customer relationships resulting from the ongoing government
investigations involving the Siemens carrier-related operations transferred to
Nokia Siemens Networks; 18) developments under large, multi-year contracts or in
relation to major customers; 19) general economic conditions globally and, in
particular, economic or political turmoil in emerging market countries where we
do business; 20) our success in collaboration arrangements relating to
development of technologies or new products and solutions; 21) the success,
financial condition and performance of our collaboration partners, suppliers and
customers; 22) any disruption to information technology systems and networks
that our operations rely on; 23) exchange rate fluctuations, including, in
particular, fluctuations between the euro, which is our reporting currency, and
the US dollar, the Chinese yuan, the UK pound sterling and the Japanese yen, as
well as certain other currencies; 24) the management of our customer financing
exposure; 25) allegations of possible health risks from electromagnetic fields
generated by base stations and mobile devices and lawsuits related to them,
regardless of merit; 26) unfavorable outcome of litigations; 27) our ability to
recruit, retain and develop appropriately skilled employees; and 28) the impact
of changes in government policies, laws or regulations; as well as the risk
factors specified on pages 12-24 of the company's annual report on Form 20-F for
the year ended December 31, 2006 under “Item 3.D Risk Factors.” Other unknown or
unpredictable factors or underlying assumptions subsequently proving to be
incorrect could cause actual results to differ materially from those in the
forward-looking statements. Nokia does not undertake any obligation to update
publicly or revise forward-looking statements, whether as a result of new
information, future events or otherwise, except to the extent legally required.
Nokia, Helsinki - April 19, 2007
Media and Investor Contacts:
Corporate Communications, tel. +358 7180 34495 or +358 7180 34900
Investor Relations Europe, tel. +358 7180 34289
Investor Relations US, tel. +1 914 368 0555
- Nokia plans to report its Q2 and Q3 2007 results on August 2 and October 18,
2007 respectively.
www.nokia.com
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