Nokia Corporation Q1 2013 Interim Report

Nokia Corporation Q1 2013 Interim Report 
ESPOO, FINLAND -- (Marketwired) -- 04/18/13 --  Nokia Corporation 
Interim report 
April 18, 2013 at 13.00 (CET+1) 
This is a summary of the first quarter 2013 interim report published
today. The
complete first quarter 2013 interim report with tables is
available at
http://www.results.nokia.com/results/Nokia_results2013Q1e.pdf.
Investors should
not rely on summaries of our interim reports only,
but should review the complete interim reports with tables. 
FINANCIAL AND OPERATING HIGHLIGHTS 
Nokia Group non-IFRS EPS in Q1 2013 was EUR -0.02; reported EPS was
EUR -0.07. 
- Nokia Group achieved underlying operating profitability for the
third consecutive quarter, with a Q1 non-IFRS operating margin of
3.1%. 
- Devices & Services achieved underlying profitability for the second
consecutive quarter, with a Q1 non-IFRS operating margin of 0.1%.
Devices & Services benefitted from a strong focus on cost as well as
the reversal of approximately EUR 50 million of previously recognized
inventory related allowances in Q1. 
- Nokia Siemens Networks achieved underlying profitability for the
fourth consecutive quarter, with a Q1 non-IFRS operating margin of
7.0%. Nokia Siemens
Networks benefitted from strong gross margin
performance in Q1. 
Nokia Group net sales in Q1 2013 were EUR 5.9 billion 
- Devices & Services Q1 net sales decreased 25% quarter-on-quarter to
EUR 2.9
billion. 
- Lumia Q1 volumes increased 27% quarter-on-quarter to 5.6 million
units, reflecting increasing momentum. 
- Mobile Phones Q1 volumes decreased 30% quarter-on-quarter to 55.8
million units, reflecting competitive industry dynamics and an
estimated higher than
normal seasonal decline in the market
addressable by Mobile Phones. 
- Nokia Siemens Networks net sales decreased 30% quarter-on-quarter
to EUR 2.8
billion, reflecting industry seasonality. 
Nokia Group net cash higher quarter-on-quarter 
- Nokia Group ends first quarter 2013 with a strong balance sheet and
solid cash
position. Gross cash was EUR 10.1 billion and net cash was
EUR 4.5 billion. 
- Nokia Group strengthened its net cash position by approximately EUR
120 million sequentially. Nokia Siemens Networks contributed
approximately EUR 210
million to the Nokia Group net cash position. 
Commenting on th
e results, Stephen Elop, Nokia CEO, said: 
"At the highest level, we are pleased that Nokia Group achieved
underlying operating profitability for the third quarter in a row.
While operating in a
highly competitive environment, Nokia is
executing our strategy with urgency and managing our costs very well. 
We have areas where we are making progress, and areas where we are
further increasing the focus. For example, people are responding
positively to the Lumia
portfolio, and our volumes are increasing
quarter over quarter. Nokia Siemens
Networks delivered another strong
quarter and contributed to an overall improvement in Nokia Group's
cash position. On the other hand, our Mobile Phones
business faces a
difficult competitive environment, and we are taking tactical
actions
and bringing new innovation to market to address our challenges. 
All of these efforts are aimed at improving our financial performance
and delivering more value to our shareholders." 


 
SUMMARY FINANCIAL INFORMATION
 
+--------------------+-----------------------------------------------+
|                    |             Reported and Non-IFRS             |
|                    |        first quarter 2013 results1,2,3        |
|                    +---------+---------+--------+---------+--------+
| EUR million        | Q1/2013 | Q1/2012 |    YoY | Q4/2012 |    QoQ |
|                    |         |         | Change |         | Change |
+--------------------+---------+---------+--------+---------+--------+
| Nokia              |         |         |        |         |        |
|                    |         |         |        |         |        |
| Net sales          |   5 852 |   7 354 |   -20% |   8 041 |   -27% |
|                    |         |         |        |         |        |
| Operating profit   |    -150 |  -1 338 |        |     427 |        |
|                    |         |         |        |         |        |
| Operating profit   |     181 |    -258 |        |     623 |   -71% |
| (non-IFRS)         |         |         |        |         |        |
|                    |         |         |        |         |        |
| EPS, EUR diluted   |   -0.07 |   -0.25 |        |    0.05 |        |
|                    |         |         |        |         |        |
| EPS, EUR diluted   |   -0.02 |   -0.08 |        |    0.05 |        |
| (non-IFRS)4        |         |         |        |         |        |
|                    |         |         |        |         |        |
| Net cash from      |     206 |    -590 |        |     563 |   -63% |
| operating          |         |         |        |         |        |
| activities         |         |         |        |         |        |
|                    |         |         |        |         |        |
| Net cash and       |   4 480 |   4 872 |    -8% |   4 360 |     3% |
| other liquid       |         |         |        |         |        |
| assets5            |         |         |        |         |        |
+--------------------+---------+---------+--------+---------+--------+
| Devices &          |         |         |        |         |        |
| Services6          |         |         |        |         |        |
|                    |         |         |        |         |        |
| Net sales          |   2 888 |   4 246 |   -32% |   3 854 |   -25% |
|                    |         |         |        |         |        |
| Smart Devices      |   1 164 |   1 704 |   -32% |   1 225 |    -5% |
| net sales          |         |         |        |         |        |
|                    |         |         |        |         |        |
| Mobile Phones      |   1 590 |   2 311 |   -31% |   2 468 |   -36% |
| net sales          |         |         |        |         |        |
|                    |         |         |        |         |        |
| Mobile device      |    61.9 |    82.7 |   -25% |    86.3 |   -28% |
| volume             |         |         |        |         |        |
| (mn units)         |         |         |        |         |        |
|                    |         |         |        |         |        |
| Smart Devices      |     6.1 |    11.9 |   -49% |     6.6 |    -8% |
| volume             |         |         |        |         |        |
| (mn units)         |         |         |        |         |        |
|                    |         |         |        |         |        |
| Mobile Phones      |    55.8 |    70.8 |   -21% |    79.6 |   -30% |
| volume             |         |         |        |         |        |
| (mn units)         |         |         |        |         |        |
|                    |         |         |        |         |        |
| Mobile device      |      47 |      51 |    -8% |      45 |     4% |
| ASP7               |         |         |        |         |        |
|                    |         |         |        |         |        |
| Smart Devices      |     191 |     143 |    34% |     186 |     3% |
| ASP7               |         |         |        |         |        |
|                    |         |         |        |         |        |
| Mobile Phones      |      28 |      33 |   -15% |      31 |   -10% |
| ASP7               |         |         |        |         |        |
|                  
  |         |         |        |         |        |
| Operating          |     -42 |    -218 |        |     263 |        |
| profit             |         |         |        |         |        |
|                    |         |         |        |         |        |
| Operating          |       4 |    -126 |        |      39 |   -90% |
| profit             |         |         |        |         |        |
| (non-IFRS)         |         |         |        |         |        |
|                    |         |         |        |         |        |
| Operating          |   -1.5% |   -5.1% |        |    6.8% |        |
| margin %           |         |         |        |         |        |
|                    |         |         |        |         |        |
| Operating margin % |    0.1% |   -3.0% |        |    1.0% |        |
| (non-IFRS)         |         |         |        |         |        |
+--------------------+---------+---------+--------+---------+--------+
| HERE6              |         |         |        |         |        |
|                    |         |         |        |         |        |
| Net sales          |     216 |     277 |   -22% |     278 |   -22% |
|                    |         |         |        |         |        |
| Operating profit   |     -97 |     -94 |        |     -56 |        |
|                    |         |         |        |         |        |
| Operating profit   |      -5 |      36 |        |      40 |        |
| (non-IFRS)         |         |         |        |         |        |
|                    |         |         |        |         |        |
| Operating          |  -44.9% |  -33.9% |        |  -20.1% |        |
| margin %           |         |         |        |         |        |
|                    |         |         |        |         |        |
| Operating          |   -2.3% |   12.9% |        |   14.4% |        |
| margin %           |         |         |        |         |        |
| (non-IFRS)         |         |         |        |         |        |
+--------------------+---------+---------+--------+---------+--------+
| Nokia Siemens      |         |         |        |         |        |
| Networks6          |         |         |        |         |        |
|                    |         |         |        |         |        |
| Net sales          |   2 804 |   2 947 |    -5% |   3 988 |   -30% |
|                    |         |         |        |         |        |
| Operating profit   |       3 |  -1 004 |        |     252 |   -99% |
|                    |         |         |        |         |        |
| Operating profit   |     196 |    -146 |        |     576 |   -66% |
| (non-IFRS)         |         |         |        |         |        |
|                    |         |         |        |         |        |
| Operating          |    0.1% |  -34.1% |        |    6.3% |        |
| margin %           |         |         |        |         |        |
|                    |         |         |        |         |        |
| Operating          |    7.0% |   -5.0% |        |   14.4% |        |
| margin %           |         |         |        |         |        |
| (non-IFRS)         |         |         |        |         |        |
+--------------------+---------+---------+--------+---------+--------+

 
Note 1 relating to non-IFRS (also referred to as "underlying")
results: In addition to information on our reported IFRS results, we
provide certain information on a non-IFRS, or underlying business
performance, basis. Non-IFRS results exclude special items for all
periods. In addition, non-IFRS results exclude intangible asset
amortization, other purchase price accounting related items and
inventory value adjustments arising from (i) the formation of
Nokia
Siemens Networks and (ii) all business acquisitions completed
after June 30, 2008.  Nokia believes that our non-IFRS results
provide meaningful supplemental information to both management and
investors regarding Nokia's underlying business performance by
excluding the above-described items that may
not be indicative of
Nokia's business operating results. These non-IFRS financial measures
should not be viewed in isolation or as substitutes to the
equivalent
IFRS measure(s), but should be used in conjunction with the most
directly comparable IFRS measure(s) in the reported results. See note
2 below
for information about the exclusions from our non-IFRS
results. More information, including a reconciliation of our Q1 2013
and Q1 2012 non-IFRS results to our reported results, can be found in
our complete Q1 2013 interim
report with tables on pages 19 and
21-25. A reconciliation of our Q4 2012 non-IFRS results to our
reported results can be found in our complete Q4 interim
report with
tables on pages 18 and 20-24 published on January 24, 2013. 
Note 2 relating to non-IFRS exclusions: 
Q1 2013 - EUR 331 million (net) consisting of: 
- EUR 129 million restructuring charge and other associated items in
Nokia Siemens Networks, including EUR 53 million of net charges
related to country and contract exits based on the strategy that
focuses on key markets and product
segments. 
- EUR 5 million restructuring charge in HERE 
- EUR 72 million restructuring charge in Devices & Services 
- EUR 27 million positive item from a cartel claim settlement in
Devices & Services 
- EUR 64 million of intangible asset amortization and other purchase
price accounting related items arising from the formation of Nokia
Siemens Networks
and the acquisition of Motorola Solutions' networks
assets 
- EUR 87 million of intangible asset amortization and other purchase
price accounting related items arising from the acquisition of NAVTEQ 
- EUR 1 million of intangible assets amortization and other purchase
price related items arising from the acquisition of Novarra, MetaCarta
and Motally in Devices & Services 
Q4 2012 - EUR 196 million (net) consisting of: 
- EUR 255 million restructuring charge and other associated items in
Nokia Siemens Networks, including EUR 34 million of net charges
related to country and contract exits based on new strategy that
focuses on key markets and product
segments,  as well  as an
impairment of assets of EUR 2 million. 
- EUR 9 million restructuring charge in HERE 
- EUR 2 million restructuring related impairments in Devices &
Services 
- EUR 75 million net benefit from releases of restructuring
provisions in Devices & Services 
- EUR 21 million positive item from a cartel claim settlements in
Devices & Services
- EUR 52 million net gain on sale of Vertu
business in Devices & Services 
- EUR 79 million net gain on sale of real estate in Devices &
Services 
- EUR 67 million of intangible asset amortization and other purchase
price accounting related items arising from the formation of Nokia
Siemens Networks
and the acquisition of Motorola Solutions' networks
assets 
- EUR 87 million of intangible asset amortization and other purchase
price accounting related items arising from the acquisition of NAVTEQ 
- EUR 1 million of intangible assets amortization and other purchase
price related items arising from the acquisition of Novarra, MetaCarta
and Motally in Devices & Services 
Q1 2012 -  EUR 1 080 million consisting of: 
- EUR 772 million restructuring charge and other associated items in
Nokia Siemens Networks 
- EUR 10 million re
structuring charge in HERE 
- EUR 91 million restructuring charge in Devices & Services 
- EUR 86 million of intangible asset amortization and other purchase
price accounting related items arising from the formation of Nokia
Siemens Networks
and the acquisition of Motorola Solutions' networks
assets 
- EUR 120 million of intangible asset amortization and other purchase
price accounting related items arising from the acquisition of NAVTEQ 
- EUR 1 million of intangible assets amortization and other purchase
price related items arising from the acquisition of Novarra, MetaCarta
and Motally in Devices & Services. 
Q1 2012 taxes - EUR 135 million valuation allowance for Nokia Siemens
Networks
deferred tax assets impacting Nokia taxes. 
Note 3 relating to changes to historical comparative financials due
to revised
IFRS accounting standard, IAS19 Employee Benefits: The
historical comparative
financials presented in the interim report
include certain changes to previously
reported information. These
changes result from the retrospective application of a revised IFRS
accounting standard IAS19, Employee Benefits and mainly relate to
consolidated statements of comprehensive income and financial
position. For more
information on the adjustments between the
previously reported information and
the adjusted information, please
see the related disclosure starting on page 39 of the complete Q1
2013 interim report with tables. 
Note 4 relating to non-IFRS Nokia EPS: Nokia taxes were unfavorably
impacted by Devices & Services taxes as no tax benefits are
recognized for certain Devices & Services deferred tax items. Certain
prior year items in Nokia Siemens Networks
also had an unfavorable
impact. If Nokia's earlier estimated long-term tax rate
of 26% had
been applied, non-IFRS Nokia EPS would have been approximately
1.7
Euro cent higher in Q1 2013. Going forward on a non-IFRS basis,
until a pattern
of tax profitability is reestablished, Nokia expects
to record quarterly tax
expense of approximately EUR 50 million
related to its Devices & Services business and approximately EUR 50
million related to its Nokia Siemens Networks
business. Nokia expects
to continue to record taxes related to its HERE business
at a 26%
rate. 
Note 5 relating to Nokia net cash and other liquid assets: Calculated
as total
cash and other liquid assets less interest-bearing
liabilities. For selected
information on Nokia Group interest-bearing
liabilities, please see the table on page 36 of the complete Q1 2013
interim report with tables. 
Note 6 relating to operational and reporting structure: We have three
businesses: Devices & Services, HERE and Nokia Siemens Networks and
four operating and reportable segments: Smart Devices and Mobile
Phones within Devices & Services, HERE and Nokia Siemens Networks.
Smart Devices focuses on
smartphones and Mobile Phones focuses on
mass market mobile devices, including
Asha full touch smartphones.
Devices & Services also contains Devices & Services
Other which
includes net sales of our luxury phone business Vertu through October
12, 2012, spare parts and related cost of sales and operating
expenses,
as well as intellectual property (IPR) income and common
research and development expenses. In October 2012, we completed the
divestment of Vertu to
EQT VI, a European private equity firm.  HERE
focuses on the development of location-based services and local
commerce. We introduced HERE as the new brand
for our location and
mapping service in November 2012. As of January 1, 2013 our Location
& Commerce business and reportable segment was renamed HERE. Nokia
Siemens Networks is one of the leading global providers of
telecommunications
infrastructure hardware, software and services,
with the focus on the mobile
broadband market. Nokia Siemens
Networks' operational organization is based on
two business units:
Mobile Broadband and Global Services. The Mobile Broadband
business
unit provides mobile operators with radio and core network
software
together with the hardware needed to deliver mobile voice
and data services. The Global Services business unit provides mobile
operators with a broad range of
services, including professional
services, network implementation and customer
care services. 
Note 7 relating to average selling prices (ASP): Mobile device ASP
represents
total Devices & Services net sales (Smart Devices net
sales, Mobile Phones net
sales, and Devices & Services Other net
sales) divided by total Devices & Services volumes. Devices &
Services Other net sales includes net sales of Nokia's luxury phone
business Vertu through October 12, 2012, spare parts, as
well as
intellectual property income. Smart Devices ASP represents Smart
Devices
net sales divided by Smart Devices volumes. Mobile Phones ASP
represents Mobile
Phones net sales divided by Mobile Phones volumes.
As IPR income is included in Devices & Services Other net sales, we
provide our total mobile device ASP both
including and excluding IPR
income. The mobile device ASP excluding IPR income
in the first
quarter 2013 was EUR 45, down 10% from EUR 50 in the first
quarter
2012 and up 5% from EUR 43 in the fourth quarter 2012. 
NOKIA OUTLOOK 
- Nokia expects its Devices & Services non-IFRS operating margin in
the second
quarter 2013 to be approximately negative 2 percent, plus
or minus four percentage points. This outlook is based on Nokia's
expectations regarding a
number of factors, including: 
- competitive industry dynamics continuing to negatively affect the
Mobile Phones and Smart Devices business units; 
- consumer demand for our products, particularly for our Mobile
Phones products; 
- continued ramp up for our Lumia smartphones; 
- expected increases in Devices & Services' operating expenses; and 
- the macroeconomic environment. 
- In the second quarter 2013 supported by the wider availability of
recently
announced Lumia products, Nokia expects the sequential
growth in Lumia unit volumes to be higher than the 27% sequential
growth in the first quarter 2013. 
- Nokia continues to target to reduce its Devices & Services non-IFRS
operating
expenses to an annualized run rate of approximately EUR 3.0
billion by the end
of 2013. 
- Nokia expects HERE's non-IFRS operating margin in the second
quarter 2013 to
be negative primarily due to lower recognized revenue
from internal sales. 
- Nokia and Nokia Siemens Networks expect Nokia Siemens Networks
non-IFRS operating margin in the second quarter 2013 to be
approximately positive 5 percent, plus or minus four percentage
points. This outlook is based on Nokia
Siemens Networks' expectations
regarding a number of factors, including: 
- competitive industry dynamics; 
- product and regional mix; and 
- the macroeconomic environment. 
- Nokia and Nokia Siemens Networks continue to target to reduce Nokia
Siemens
Networks' non-IFRS annualized operating expenses and
production overheads by
more than EUR 1 billion by the end of 2013,
compared to the end of 2011. 
FIRST QUARTER 2013 FINANCIAL AND OPERATING DISCUSSION 
NOKIA GROUP 
See note 6 to our Summary Financial Information table above
concerning our current operational and reporting structure and note 3
concerning certain changes to historical comparative financials due
to a revised IFRS accounting
standard, IAS19 Employee Benefits. The
following discussion includes information
on a non-IFRS, or
underlying business performance, basis. See notes 1 and 2 to
our
Summary Financial Information table above for information about our
underlying non-IFRS results and the non-IFRS exclusions for the
periods discussed below. 
The following table sets forth the year-on-year and sequential growth
rates in
our net sales on a reported basis and at constant currency
for the periods
indicated. 


 
+----------------------------------------------------------------
+
| FIRST QUARTER 2013 NET SALES,                                  |
| REPORTED & CONSTANT CURRENCY1                                  |
 
+--------------------------------------+------------+------------+
|                                      | YoY Change | QoQ Change |
+--------------------------------------+------------+------------+
| Group net sales - reported           |    -20%    |    -27%    |
|                                      |            |            |
| Group net sales - constant currency1 |    -21%    |    -26%    |
|                                      |            |            |
| Devices & Services                   |    -32%    |    -25%    |
| net sales - reported                 |            |            |
|                                      |            |            |
| Devices & Services                   |    -33%    |    -23%    |
| net sales - constant currency1       |            |            |
|                                      |            |            |
| Nokia Siemens Networks               |    -5%     |    -30%    |
| net sales - reported                 |            |            |
|                                      |            |            |
| Nokia Siemens Networks               |    -4%     |    -28%    |
| net sales - constant currency1       |            |            |
+--------------------------------------+------------+------------+

 
Note 1: Change in net sales at constant currency excludes the impact
of changes
in exchange rates in comparison to the Euro, our reporting
currency. 
At constant currency Nokia Group's net sales would have decreased 21%
year-on-year and 26% sequentially. 
The following table sets forth Nokia Group's reported cash flow for
the periods
indicated and financial position at the end of the periods
indicated, as well as the year-on-year and sequential growth rates. 


 
+----------------------------------------------------------------
----+
|NOKIA GROUP CASH FLOW                                               |
|AND FINANCIAL POSITION                                              |
+------------------------------+-------+-------+------+-------+------+
|EUR million                   |Q1/2013|Q1/2012|   YoY|Q4/2012|   QoQ|
|                              |       |       |Change|       |Change|
+------------------------------+-------+-------+------+-------+------+
|Net cash from                 |   206 |   -590|      |    563| -63% |
|operating activities          |       |       |      |       |      |
+------------------------------+-------+-------+------+-------+------+
|NSN contribution (approximate)|   270 |   410 | -34% |    740|  -64%|
+------------------------------+-------+-------+------+-------+------+
|Total cash and                |10 102 |  9 793|    3%|  9 909|    2%|
|other liquid assets           |       |       |      |       |      |
+------------------------------+-------+-------+------+-------+------+
|NSN contribution              | 2 753 |  1 535|  79% |  2 420|   14%|
+------------------------------+-------+-------+------+-------+------+
|Net cash and                  | 4 480 |  4 872|  -8% |  4 360|   3% |
|other liquid assets1          |       |       |      |       |      |
+------------------------------+-------+-------+------+-------+------+
|NSN contribution              | 1 484 |    256|  480%|  1 270|   17%|
+------------------------------+-------+-------+------+-------+------+

 
Note 1: Total cash and other liquid assets minus interest-bearing
liabilities. 
In the first quarter 2013, Nokia Group total cash and other liquid
assets increased by EUR 193 million and Nokia Group net cash and other
liquid assets
increased by EUR 120 million. 
The items below are the primary drivers of the increase in Nokia
Group net cash
and other liquid assets in the first quarter 2013 of
EUR 120 million: 
- Nokia Group level net profit adjusted for non-cash items of
positive EUR 323
million; 
- Nokia Group level net working capital related cash outflows of
approximately
EUR 170 million, which included approximately EUR 250
million of restructuring
related cash outflows; 
- Nokia Group excluding Nokia Siemens Networks level net working
capital related
outflows of approximately EUR 300 million, which
included approximately EUR 120
million of restructuring related
outflows. The net working capital change in
Nokia Group excluding
Nokia Siemens Networks is primarily due to a reduction of payables,
partially offset by a reduction of receivables; 
- Nokia Siemens Networks level net working capital related inflows of
approximately EUR 140 million, which included approximately EUR 130
million of
restructuring related outflows. The net working capital
change in Nokia Siemens
Networks is primarily due to a reduction of
receivables, which more than offset
the reduction of payables; 
- Nokia Group level net financial income and expense related cash
inflow of approximately EUR 80 million, 
- Nokia Group level cash tax net outflows of approximately EUR 30
million; 
- Nokia Group level CAPEX of approximately EUR 120 million; and 
- Nokia Group level proceeds from the sale of fixed assets of
approximately EUR
40 million. 
In the first quarter 2013, due to the settlement of an intragroup
balance, Nokia
Siemens Networks had a cash outflow related to net
working capital of approximately EUR 170 million and Nokia Group
excluding Nokia Siemens Networks
had a cash inflow related to net
working capital of approximately EUR 170 million. At the Nokia Group
level the net impact was zero. 
In the first quarter 2013, we received a quarterly platform support
payment of
USD 250 million (approximately EUR 188 million) from
Microsoft. Our agreement
with Microsoft includes platform support
payments from Microsoft to us as well
as software royalty payments
from us to Microsoft. Under the terms of the agreement governing the
platform support payments, the amount of each quarterly
platform
support payment is USD 250 million. We have a competitive software
royalty structure, which includes annual minimum software royalty
commitments
that vary over the life of the agreement. Software
royalty payments, with minimum commitments are paid quarterly. Over
the life of the agreement, both the platform support payments and the
minimum software royalty commitments are expected to measure in the
billions of US dollars. Over the life of the agreement the total
amount of the platform support payments is expected to slightly
exceed the total amount of the minimum software royalty commitment
payments. In accordance with the terms of the agreement, the platform
support
payments and annual minimum software royalty commitment
payments continue for a corresponding period of time. 
In the first quarter 2013, Nokia received a claim from Indian tax
authorities
relating to withholding tax amounting to EUR 225 million
plus applicable interests. Nokia reiterates its position that its
operations are in compliance
with local laws as well as the
bilaterally negotiated tax treaty between the
Governments of India
and Finland, and that it will defend itself vigorously against the
claim. 
DEVICES & SERVICES 
The following table sets forth a summary of the results for our
Devices & Services business for the periods indicated, as well as the
year-on-year and
sequential growth rates. 


 
+----------------------------------------------------------------
---------+
| DEVICES & SERVICES                                                      |
| RESULTS SUMMARY                                                         |
+---------------------------+---------+---------+--------+---------+------+
|                           | Q1/2013 | Q1/2012 |    YoY | Q4/2012 |   QoQ|
|                           |         |         | Change |         |Change|
+---------------------------+---------+---------+--------+---------+------+
| Net sales (EUR million)1  |   2 888 |   4 246 |   -32% |   3 854 |  -25%|
+---------------------------+---------+---------+--------+---------+------+
| Mobile device volume      |    61.9 |    82.7 |   -25% |    86.3 |  -28%|
| (million units)           |         |     
    |        |         |      |
+---------------------------+---------+---------+--------+---------+------+
| Mobile device ASP (EUR)   |      47 |      51 |    -8% |      45 |    4%|
+---------------------------+---------+---------+--------+---------+------+
| Non-IFRS gross margin (%) |   25.1% |   24.4% |        |   23.9% |      |
+---------------------------+---------+---------+--------+---------+------+
| Non-IFRS operating        |     711 |   1 122 |   -37% |     882 |  -19%|
| expenses (EUR million)    |         |         |        |         |      |
+---------------------------+---------+---------+--------+---------+------+
| Non-IFRS operating        |    0.1% |   -3.0% |        |    1.0% |      |
| margin (%)                |         |         |        |         |      |
+---------------------------+---------+---------+--------+---------+------+
| Operating margin (%)      |   -1.5% |   -5.1% |        |    6.8% |      |
+---------------------------+---------+---------+--------+---------+------+

 
Note 1: Includes IPR income recognized in Devices & Services Other net
sales. 
The year-on-year and sequential changes in our Devices & Services net
sales,
volumes, average selling prices and gross margin are discussed
below under our
Smart Devices and Mobile Phones business units. 
Smartphone Volumes 
In the first quarter 2013, Devices & Services total smartphone
volumes were 11.1 million units, composed of: 
- 5.0 million Asha full touch smartphones in Mobile Phones 
- 5.6 million Lumia smartphones in Smart Devices 
- 0.5 million Symbian smartphones in Smart Devices 
Devices & Services Other 
Year-on-year Devices & Services Other net sales were lower in the
first quarter
2013 primarily due to the divestment of Vertu. In
addition to the divestment of Vertu, the sequential Devices &
Services Other net sales were lower in the first
quarter 2013 due to
the absence of a non-recurring IPR income of approximately
EUR 50
million that was recognized in the fourth quarter 2012. 
Following the divestment of Vertu in October 2012, Devices & Services
Other net
sales are comprised of IPR income and sales of spare parts.
Within Devices &
Services Other, we estimate that our current annual
IPR income run-rate is approximately EUR 0.5 billion. 
Channel Inventory 
We ended the first quarter 2013 slightly above the high end of our
normal 4 to
6 week channel inventory range. On an absolute unit basis
channel inventories
decreased sequentially. 
Net Sales and Volumes by Geographic Area 
The following table sets forth the net sales for our Devices &
Services business
for the periods indicated, as well as the
year-on-year and sequential growth
rates, by geographic area. IPR
income is allocated to the geographic areas contained in this chart. 


 
+----------------------------------------------------------------
------+
| DEVICES & SERVICES NET SALES                                         |
| BY GEOGRAPHIC AREA                                                   |
+----------------------+---------+---------+--------+---------+--------+
| EUR million          | Q1/2013 | Q1/2012 |    YoY | Q4/2012 |    QoQ |
|                      |         |         | Change |         | Change |
+----------------------+---------+---------+--------+---------+--------+
| Europe               |     895 |   1 352 |   -34% |   1 210 |   -26% |
|                      |         |         |        |         |        |
| Middle East & Africa |     501 |     737 |   -32% |     745 |   -33% |
|                      |         |         |        |         |        |
| Greater China        |     256 |     577 |   -56% |     213 |    20% |
|                      |         |         |        |         |        |
| Asia-Pacific         |     724 |     945 |   -23% |     941 |   -23% |
|                      |         |         |        |         |        |
| North America        |     101 |      93 |     9% |     196 |   -48% |
|                      |         |         |        |         |        |
| Latin America        |     411 |     542 |   -24% |     549 |   -25% |
+----------------------+---------+---------+--------+---------+--------+
| Total                |   2 888 |   4 246 |   -32% |   3 854 |   -25% |
+----------------------+---------+---------+--------+---------+--------+

 
The following table sets forth the mobile device volumes for our
Devices & Services business for the periods indicated, as well as the
year-on-year and
sequential growth rates, by geographic area. 


 
+----------------------------------------------------------------
------+
| DEVICES & SERVICES MOBILE DEVICE                                     |
| VOLUMES BY GEOGRAPHIC AREA                                           |
+----------------------+---------+---------+--------+---------+--------+
| million units        | Q1/2013 | Q1/2012 |    YoY | Q4/2012 |    QoQ |
|                      |         |         | Change |         | Change |
+----------------------+---------+---------+--------+---------+--------+
| Europe               |    11.8 |    15.8 |   -25% |    19.4 |   -39% |
|                      |         |         |        |         |        |
| Middle East & Africa |    15.5 |    21.4 |   -28% |    21.8 |   -29% |
|                      |         |         |        |         |        |
| Greater China        |     3.4 |     9.2 |   -63% |     4.6 |   -26% |
|                      |         |         |        |         |        |
| Asia-Pacific         |    23.1 |    26.1 |   -11% |    28.7 |   -20% |
|                      |         |         |        |         |        |
| North America        |     0.4 |     0.6 |   -33% |     0.7 |   -43% |
|                      |         |         |        |         |        |
| Latin America        |     7.7 |     9.6 |   -20% |    11.1 |   -31% |
+----------------------+---------+---------+--------+---------+--------+
| Total                |    61.9 |    82.7 |   -25% |    86.3 |   -28% |
+----------------------+---------+---------+--------+---------+--------+

 
On a year-on-year basis, net sales decreased in all regions except
North America
where the increase was primarily due to our Smart
Devices business unit. The
largest relative year-on-year decline in
net sales was in Greater China followed
by Europe and Middle East and
Africa. In Greater China and Europe the net sales
declines were
primarily due to our Smart Devices business unit whereas in
the
Middle East and Africa the net sales decline was primarily due to
our Mobile
Phones business unit. 
On a sequential basis, net sales decreased in all regions except
Greater China
where the increase was primarily due to our Smart
Devices business unit. The
largest relative sequential declines in
net sales were in North America followed
by Middle East and Africa
and Europe. The sequential net sales decline in North
America was
primarily due to our Smart Devices business unit, whereas in
Middle
East and Africa and Europe the net sales declines were
primarily due to our Mobile Phones business unit. 
At constant currency Devices & Services' net sales would have
decreased 33% year-on-year and 23% sequentially. 
Non-IFRS Operating Expenses 
Devices & Services non-IFRS operating expenses decreased 37%
year-on-year and
19% sequentially in the first quarter 2013. On a
year-on-year basis, operating
expenses related to Mobile Phones and
Smart Devices decreased 43% and 24%, respectively, in the first
quarter 2013. On a sequential basis, operating expenses related to
Mobile Phones decreased by 23%, while Smart Devices operating
expenses decreased 13% in the first quarter 2013. In addition to
the
factors described below, the year-on-year and sequential changes
were affected
by the proportionate allocation of operating expenses
being affected by the relative mix of sales and gross profit
performance between Mobile Phones and
Smart Devices. This resulted in
higher and lower relative allocations to Smart
Devices and Mobile
Phones, respectively. 
Devices & Services non-IFRS research and development expenses
decreased 37% year-on-year in the first quarter 2013. On a sequential
basis, Devices & Services non-IFRS research and development expenses
decreased 15% in the first
quarter 2013. The year-on-year decline was
primarily due to ramping down Symbian
and MeeGo research and
development efforts, reductions in certain Mobile Phones
related
activities and overall cost controls. On a sequential basis, the
decline
was primarily due to overall cost controls. 
Devices & Services non-IFRS sales and marketing expenses decreased
36% year-on-year in the first quarter 2013. On a year-on-year basis,
marketing expenses
declined primarily due to tight cost control and
headcount reductions, lower
product specific marketing and a lower
cost base as a result of business divestments. On a sequential basis,
Devices & Services non-IFRS sales and marketing expenses decreased
26% in the first quarter 2013. Sequentially, marketing expenses
decreased primarily due to seasonality, headcount reductions
and
tight cost control. 
Devices & Services non-IFRS administrative and general expenses
decreased 38%
year-on-year in the first quarter 2013 and were flat
sequentially. The year-on-year decrease was primarily related to cost
savings in support functions and business divestments, partially
offset by shared function cost categorization. 
In the first quarter 2013, Devices & Services non-IFRS other income
and expense
had a positive year-on-year and negative sequential impact
on profitability. 
On a reported basis, in the first quarter 2013 Devices & Services
other income
and expense was negatively affected due to restructuring
costs for changes in
the IT organization, offset by a positive item
from a cartel settlement. In the
fourth quarter 2012, other income
was positively affected primarily as a result
of gains from real
estate sales, business divestments, a positive item from a
cartel
settlement, and restructuring-related provision releases, which were
recognized in Devices & Services Other. 
Non-IFRS Operating Margin 
The higher year-on-year Devices & Services non-IFRS operating margin
in the first quarter 2013 was primarily due to lower operating
expenses as a percentage
of net sales and higher gross margin. 
The sequentially lower Devices & Services non-IFRS operating margin
in the first
quarter 2013 was primarily due to higher operating
expenses as a percentage of
net sales partially offset by higher
gross margin. 
Operating Margin 
The higher year-on-year Devices & Services operating margin in the
first quarter
2013 was primarily due to lower operating expenses as a
percentage of net sales,
lower other income and expenses (net other
expense in both first quarter 2013
and first quarter 2012) as a
percentage of net sales and higher gross margin. 
The sequentially lower Devices & Services operating margin in the
first quarter
2013 was primarily due to other income and expenses (net
other expense in first
quarter 2013 and net other income in fourth
quarter 2012) as a percent of net
sales as well as higher operating
expenses as a percentage of net sales, partially offset by higher
gross margin. 
Cost Reduction Activities and Planned Operational Adjustments 
The following table sets forth a summary of our Devices & Services
cost reduction activities and planned operational adjustments. 


 
+----------------------------------------------------------------
---------+
|DEVICES & SERVICES RESTRUCTURING SUMMARY                                 |
+----------+---------+-------------+------------+------------+------------+
|EUR       |  Q1/2013|Cumulative up|     Q2/2013|       2013 |       Total|
|(million) |(approxi-|  to  Q1/2013|(approximate|(approximate|(approximate|
|          |    mate)|(approximate)|   estimate)|    estimate|   estimate)|
+----------+---------+-------------+------------+------------+------------+
|Restructu-|       72|        1 400|Not provided|Not provided|       1 600|
|ring      |         |             |            |            |            |
|related   |         |             |            |            |            |
|charges   |         |             |            |            |            |
+----------+---------+-------------+------------+------------+------------+
|Restructu-|      110|        1 200|          50|         300|       1 400|
|ring      |         |             |            |            |            |
|related   |         |             |            |            |            |
|cash      |         |             |            |            |            |
|outflows  |         |             |            |            |            |
+----------+---------+-------------+------------+------------+------------+

 
Nokia continues to target to reduce its Devices & Services non-IFRS
operating
expenses to an annualized run rate of approximately EUR 3.0
billion by the end
of 2013. 
At the end of the first quarter 2013, Devices & Services and
Corporate Common
had approximately 31 600 employees, a reduction of
approximately 15 500 compared
to the end of the first quarter 2012,
and approximately 1 600 compared to the
end of the fourth quarter
2012. 
SMART DEVICES 
The following table sets forth a summary of the results for our Smart
Devices
business unit for the periods indicated, as well as the
year-on-year and sequential growth rates. 


 
+----------------------------------------------------------------
---------+
|SMART DEVICES RESULTS SUMMARY                                            |
+-------------------------+---------+---------+--------+---------+--------+
|                         | Q1/2013 | Q1/2012 |    YoY | Q4/2012 |    QoQ |
|                         |         |         | Change |         | Change |
+-------------------------+---------+---------+--------+---------+--------+
|Net sales (EUR million)1 |   1 164 |   1 704 |   -32% |   1 225 |    -5% |
+-------------------------+---------+---------+--------+---------+--------+
|Smart Devices volume     |     6.1 |    11.9 |   -49% |     6.6 |    -8% |
|(million units)          |         |         |        |         |        |
+-------------------------+---------+---------+--------+---------+--------+
|Smart Devices ASP (EUR)  |     191 |     143 |    34% |     186 |     3% |
+-------------------------+---------+---------+--------+---------+--------+
|Gross margin (%)         |   20.7% |   15.6% |        |   18.0% |        |
+-------------------------+---------+---------+--------+---------+--------+
|Operating expenses       |     420 |     556 |   -24% |     481 |   -13% |
|(EUR million)2           |         |         |        |         |        |
+-------------------------+---------+---------+--------+---------+--------+
|Contribution margin (%)2 |  -16.2% |  -18.3% |        |  -21.6% |        |
+-------------------------+---------+---------+--------+---------+--------+

 
Note 1: Does not include IPR income. IPR income is recognized in
Devices & Services Other net sales. 
Note 2: The year-on-year and sequential changes in operating expenses
were affected by the proportionate allocation of operating expenses
being affected by the relative mix of sales and gross profit
performance between Mobile Phones and Smart Devices, resulting in
higher relative allocations to Smart Devices in the
first quarter
2013. Accordingly, first quarter 2013 operating expenses are
not
directly comparable to first and fourth quarters 2012 operating
expenses. 
Net Sales 
Both on a year-on-year and sequential basis, the declines in our
Smart Devices
net sales in the first quarter 2013 were due to lower
volumes partially offset
by higher ASPs. 
Volume 
During the first quarter 2013 we shipped 6.1 million Smart Devices
units, of
which 5.6 million units were Lumia products and 0.5 million
units were Symbian
products. In the first quarter 2013, approximately
two-thirds of our Lumia volumes were Windows Phone 8-based products. 
The year-on-year decline in our Smart Device
s volumes in the first
quarter 2013
continued to be driven by the strong momentum of
competing smartphone platforms
and our portfolio transition from
Symbian products to Lumia products. The decline was primarily due to
lower Symbian volumes, partially offset by higher
Lumia volumes. 
On a sequential basis, the decrease in our Smart Devices volumes in
the first
quarter 2013 was primarily due to lower Symbian volumes,
partially offset by
higher Lumia volumes as we started shipping the
Lumia 620 in significant volumes
and broadened the geographical
distribution of the Lumia 920 and Lumia 820. On a geographical basis,
Lumia volumes increased sequentially in all regions except
for North
America. 
Average Selling Price 
The year-on-year increase in our Smart Devices ASP in the first
quarter 2013 was primarily due to a positive mix shift towards sales
of our Lumia products which
carry a higher ASP than our Symbian
products, partially offset by our pricing
actions which commenced in
the second quarter 2012 primarily related to our Windows Phone
7-based Lumia products. 
Sequentially, the increase in our Smart Devices ASP in the first
quarter  2013
was primarily due to a positive mix shift towards sales
of our Windows Phone
8-based Lumia products, partially offset by
price erosion. The ASP of our Lumia
products in the first quarter
2013 was EUR 182, compared to EUR 192 in the fourth quarter 2012. 
Gross Margin 
The year-on-year increase in our Smart Devices gross margin in the
first quarter
2013 was primarily due to the positive mix shift towards
higher gross margin
products, the reversal of approximately EUR 50
million of previously recognized
inventory related allowances related
to our Windows Phone 7-based Lumia products, cost erosion of
materials we use in our products and lower Symbian
fixed costs per
unit. This was partially offset by the pricing actions we commenced
in the second quarter 2012 primarily related to our Windows Phone
7-based Lumia products, as well as a net negative impact related to
foreign currency fluctuations and higher warranty costs. From an
operating system perspective, the year-on-year increase in our Smart
Devices gross margin in the
first quarter 2013 was due to a higher
gross margin for our Lumia products, as
well as for our Symbian
products. 
On a sequential basis, the increase in our Smart Devices gross margin
in the
first quarter 2013 was primarily due to a positive product mix
shift towards
higher gross margin products, as well as the reversal of
approximately EUR 50
million of previously recognized inventory
related allowances related to our
Windows Phone 7-based Lumia
products. This was partially offset by greater price
erosion than
cost erosion, a net negative impact related to foreign
currency
fluctuations and higher warranty costs. 
During the first quarter 2013 our Windows Phone 8-based Lumia
products generated
a gross margin, somewhat above the overall Smart
Devices gross margin of 20.7%. 
Increases or decreases to Smart Devices inventory related allowances
may be required in the future depending on several factors, including
consumer demand
and continued ramp up particularly related to our new
Lumia products. 
MOBILE PHONES 
The following table sets forth a summary of the results for our
Mobile Phones
business unit for the periods indicated, as well as the
year-on-year and sequential growth rates. 


 
+----------------------------------------------------------------
---------+
|MOBILE PHONES RESULTS SUMMARY                                            |
+-----------------------------------+-------+-------+------+-------+------+
|                                   |Q1/2013|Q1/2012|   YoY|Q4/2012|   QoQ|
|                                   |       |       |Change|       |Change|
+-----------------------------------+-------+-------+------+-------+------+
|Net sales (EUR million)1           |  1 590|  2 311|  -31%|  2 468|  -36%|
+-----------------------------------+-------+-------+------+-------+------+
|Mobile Phones volume (million      |       |       |      |       |      |
|units)                             |   55.8|   70.8|  -21%|   79.6|  -30%|
+-----------------------------------+-------+-------+------+-------+------+
|Mobile Phones ASP (EUR)            |     28|     33|  -15%|     31|  -10%|
+-----------------------------------+-------+-------+------+-------+------+
|Gross margin (%)                   |  22.9%|  25.9%|      |  22.2%|      |
+-----------------------------------+-------+-------+------+-------+------+
|Operating expenses (EUR million)2  |    267|    472|  -43%|    346|  -23%|
+-----------------------------------+-------+-------+------+-------+------+
|Contribution margin (%)2           |   5.5%|   4.6%|      |   8.2%|      |
+-----------------------------------+-------+-------+------+-------+------
+

 
Note 1: Does not include IPR income. IPR income is recognized in
Devices & Services Other net sales. 
Note 2: The year-on-year and sequential changes in operating expenses
were affected by the proportionate allocation of operating expenses
being affected by the relative mix of sales and gross profit
performance between Mobile Phones and Smart Devices, resulting in
lower relative allocations to Mobile Phones in the
first quarters
2013. Accordingly, first quarter 2013 operating expenses are
not
directly comparable to first and fourth quarter 2012 operating
expenses. 
Net Sales 
Both on a year-on-year and sequential basis, the declines in our
Mobile Phones
net sales in the first quarter 2013 were due to lower
volumes and lower ASPs. 
Volume 
During the first quarter 2013 we shipped 55.8 million Mobile Phones
units, of
which 5.0 million were Asha full touch smartphones. 
On a year-on-year basis, our Mobile Phones volumes in the first
quarter 2013
were negatively affected by competitive industry
dynamics, including intense
smartphone competition at increasingly
lower price points and intense competition at the low end of our
product portfolio as well as an estimated higher than normal seasonal
decline in the market addressable by Mobile Phones.
Compared to the
first quarter 2012, our Mobile Phones volumes declined across
our
portfolio, most notably for our non-full touch devices that we sell
to our
customers for above EUR 30. These declines were partially
offset by sales volumes of Asha full touch smartphones in the first
quarter 2013 that were not
part of our portfolio in the first quarter
2012. 
On a sequential basis, our Mobile Phones volumes in the first quarter
2013 were
negatively affected by competitive industry dynamics,
including intense competition at the low end of our product portfolio
and smartphone competition
at increasingly lower price points
affecting the rest of our Mobile Phones portfolio, as well as
estimated higher than normal seasonal decline in the market
addressable by Mobile Phones. Compared to the fourth quarter 2012
our
Mobile Phones volumes declined across our portfolio, most notably
for lower priced devices that we sell to our customers for below EUR
30. 
Asha full touch smartphones Q1 volumes decreased 46%
quarter-on-quarter to 5.0
million units, reflecting intense
competitive industry dynamics as well as lower
seasonal demand. 
During the first quarter 2013, our Mobile Phones channel inventory
declined in
absolute unit volumes. 
Average Selling Price 
The year-on-year decline in our Mobile Phones ASP in the first
quarter 2013 was
primarily due to general price erosion and an
increased proportion of sales of
lower priced devices, partially
offset by a net positive impact related to foreign currency
fluctuations. 
The sequential decline in our Mobile Phones ASP in the first quarter
2013 was
primarily due to general price erosion, a net negative impact
related to foreign
currency fluctuations and a higher proportion of
sales of lower priced devices. 
Gross Margin 
The year-on-year decline in our Mobile Phones gross margin in the
first quarter
2013 was 
primarily due to a negative product mix shift
towards lower gross margin devices, as well as the net negative
impact related to foreign currency
fluctuations, partially offset by
lower freight costs. 
On a sequential basis, the increase in our Mobile Phones gross margin
in the
first quarter 2013 was primarily due to lower warranty costs,
partially offset
by higher price erosion than cost erosion and higher
fixed costs per unit because of lower sales volumes. 
HERE 
In November 2012, Nokia introduced HERE as the new brand for its
location and
mapping service. As of January 1, 2013 our Location &
Commerce business and reportable segment was renamed HERE. 
The following table sets forth a summary of the results for HERE for
the periods
indicated, as well as the year-on-year and sequential
growth rates. 


 
+----------------------------------------------------------------
------+
|HERE RESULTS SUMMARY                                                  |
+--------------------------------+-------+-------+------+-------+------+
|                                |Q1/2013|Q1/2012|   YoY|Q4/2012|   QoQ|
|                                |       |       |Change|       |Change|
+--------------------------------+-------+-------+------+-------+------+
|Net sales (EUR million)         |    216|    277|  -22%|    278|  -22%|
+--------------------------------+-------+-------+------+-------+------+
|External net sales (EUR million)|    164|    166|   -1%|    204|  -20%|
+--------------------------------+-------+-------+------+-------+------+
|Internal net sales (EUR million)|     52|    111|  -53%|     74|  -30%|
+--------------------------------+-------+-------+------+-------+------+
|Non-IFRS gross margin (%)       |  75.5%|  77.7%|      |  82.0%|      |
+--------------------------------+-------+-------+------+-------+------+
|Non-IFRS operating              |    168|    174|   -3%|    189|  -11%|
|expenses (EUR million)          |       |       |      |       |      |
+--------------------------------+-------+-------+------+-------+------+
|Non-IFRS operating              |  -2.3%|  12.9%|      |  14.4%|      |
|margin (%)                      |       |       |      |       |      |
+--------------------------------+-------+-------+------+-------+------+
|Operating margin (%)            | -44.9%| -33.9%|      | -20.1%|      |
+--------------------------------+-------+-------+------+-------+------+

 
Net Sales 
In the first quarter 2013, the year-on-year decrease in external HERE
net sales
was primarily due to lower net sales to our personal
navigation device customers
as well as lower advertising revenue,
partially offset by higher sales of map
content licenses to vehicle
customers due to higher consumer uptake of vehicle
navigation systems
and higher platform sales. 
In the first quarter 2013, the sequential decrease in external HERE
net sales
was primarily due to lower seasonal sales to our personal
navigation device and
vehicle customers. 
In the first quarter 2013, the year-on-year and sequential declines
in internal
HERE net sales were due to declines in sales, including
lower recognition of
deferred revenue, primarily related to our Smart
Devices business unit. 
Gross Margin 
Both on a year-on-year and sequential basis, the decreases in HERE
non-IFRS gross margin in the first quarter 2013 were primarily due to
lower net sales to our personal navigation device customers as well
as lower internal sales. 
Operating Expenses 
HERE non-IFRS research and development expenses decreased 2%
year-on-year due to cost reduction actions. On a sequential basis,
research and development expenses
decreased 11% in the first quarter
2013 primarily due to decreased product development spending. 
HERE non-IFRS sales and marketing expenses decreased 13% year-on-year
primarily
due to cost reduction actions. On a sequential basis, sales
and marketing expenses decreased 21% in the first quarter 2013
primarily due to lower seasonal
marketing spend and the absence of
marketing investments in the HERE brand launch in the fourth quarter
2012. 
HERE non-IFRS administrative and general expenses were approximately
flat year-on-year and sequentially in the first quarter 2013. 
HERE non-IFRS other income and expense for the first quarter 2013 was
approximately zero, compared to expense of EUR 6 million in the first
quarter
2012 and income of EUR 1 million in the fourth quarter 2012. 
Non-IFRS Operating Margin 
The year-on-year decrease in HERE non-IFRS operating margin in the
first quarter
2013 was primarily due to higher operating expenses as a
percentage of net sales
and lower gross margin. 
The sequential decrease in HERE non-IFRS operating margin in the
first quarter
2013 was primarily due to higher operating expenses as a
percentage of net sales
and lower gross margin. 
Operating Margin 
The year-on-year decrease in HERE operating margin in the first
quarter 2013 was primarily due to higher operating expenses as a
percentage of net sales, lower
gross margin, partially offset by
lower other income and expenses as a percentage of net sales. 
The sequential decrease in HERE operating margin in the first quarter
2013 was
primarily due to higher operating expenses as a percentage of
net sales and lower gross margin. 
NOKIA SIEMENS NETWORKS 
The following table sets forth a summary of the results for Nokia
Siemens Networks for the periods indicated, as well as the
year-on-year and sequential
growth rates. 


 
+----------------------------------------------------------------
---------+
| NOKIA SIEMENS NETWORKS RESULTS SUMMARY                                  |
+---------------------------+---------+---------+--------+-------+--------+
|                           | Q1/2013 | Q1/2012 |    YoY |Q4/2012|    QoQ |
|                           |         |         | Change |       | Change |
+---------------------------+---------+---------+--------+-------+--------+
| Net sales (EUR million)   |   2 804 |   2 947 |    -5% |  3 988|   -30% |
+---------------------------+---------+---------+--------+-------+--------+
| Non-IFRS gross margin (%) |   34.0% |   26.6% |        |  36.0%|        |
+---------------------------+---------+---------+--------+-------+--------+
| Non-IFRS operating        |     763 |     936 |   -18% |    843|    -9% |
| expenses (EUR million)    |         |         |        |       |        |
+---------------------------+---------+---------+--------+-------+--------+
| Non-IFRS operating        |    7.0% |   -5.0% |        |  14.4%|        |
| margin (%)                |         |         |        |       |        |
+---------------------------+---------+---------+--------+-------+--------+
| Operating margin (%)      |    0.1% |  -34.1% |        |   6.3%|        |
+---------------------------+---------+---------+--------+-------+--------+

 
Net Sales 
The following table sets forth Nokia Siemens Networks net sales for
the periods
indicated, as well as the year-on-year and sequential
growth rates, by geographic area. 


 
+----------------------------------------------------------------
------+
| NOKIA SIEMENS NETWORKS                                               |
| NET SALES BY GEOGRAPHIC AREA                                         |
+----------------------+---------+---------+--------+---------+--------+
| EUR million          | Q1/2013 | Q1/2012 |    YoY | Q4/2012 |    QoQ |
|                      |         |         | Change |         | Change |
+----------------------+---------+---------+--------+---------+--------+
| Europe               |     731 |     930 |   -21% |   1 058 |   -31% |
|                      |         |         |        |         |        |
| Middle East & Africa |     259 |     270 |    -4% |     388 |   -33% |
|                      |         |         |        |         |        |
| Greater China        |     223 |     209 |     7% |     416 |   -46% |
|                      |         |         |        |         |        |
| Asia-Pacific         | 
    872 |     877 |    -1% |   1 176 |   -26% |
|                      |         |         |        |         |        |
| North America        |     424 |     283 |    50% |     426 |     0% |
|                      |         |         |        |         |        |
| Latin America        |     295 |     378 |   -22% |     524 |   -44% |
+----------------------+---------+---------+--------+---------+--------+
| Total                |   2 804 |   2 947 |    -5% |   3 988 |   -30% |
+----------------------+---------+---------+--------+---------+--------+

 
In the first quarter 2013, Global Services represented approximately
51% of Nokia Siemens Networks net sales, compared to approximately
52% in the first
quarter 2012 and approximately 50% in the fourth
quarter 2012. In the first quarter 2013, Mobile Broadband represented
approximately 44% of Nokia Siemens
Networks net sales, compared to
approximately 41% in the first quarter 2012 and
approximately 45% in
the fourth quarter 2012. 
The year-on-year decrease in Nokia Siemens Networks' net sales in the
first quarter 2013 was primarily due to divestments of businesses not
consistent with
Nokia Siemens Networks' strategic focus as well as the
exiting of certain customer contracts. Excluding these two factors,
Nokia Siemens Networks' net
sales in the first quarter 2013 declined
by approximately 1% as lower net sales
of Global Services were almost
entirely offset by higher net sales in Mobile
Broadband. The
year-on-year decline in Global Services was primarily due to lower
net sales in Professional Services and Care. The year-on-year
increase in Mobile Broadband was primarily due to higher LTE net
sales, partially offset by lower WCDMA and Voice and IP
transformation net sales. 
On a regional basis, the year-on-year decline was primarily due to
lower net
sales in Europe and Latin America which both saw lower net
sales in Mobile Broadband, partially offset by higher net sales in
North America which saw growth in both Mobile Broadband and Global
Services net sales. 
The sequential decrease in Nokia Siemens Networks' net sales in the
first quarter 2013 was primarily due to lower sales of both Mobile
Broadband and Global Services consistent with industry seasonality as
well as the absence of
non-recurring IPR income of approximately EUR
30 million that was recognized in the fourth quarter 2012. The
sequential decline in Mobile Broadband was due to
lower sales in GSM,
WCDMA and Voice and IP transformation net sales. The sequential
decline in Global Services was due to lower net sales in Network
Implementation and Professional Services. 
On a regional basis, Mobile Broadband and Global Services net sales
declined
sequentially in all regions except for North America. North
America was approximately flat on a sequential basis, due to an
increase in Mobile Broadband
net sales, almost completely offset by a
decline in Global Services net sales. 
At constant currency, Nokia Siemens Networks' net sales would have
decreased 4% year-on-year and 28% sequentially. Excluding divestments
of businesses not consistent with Nokia Siemens Networks' strategic
focus and the exiting of certain customer contracts, Nokia Siemens
Networks' net sales were approximately
flat on a constant currency
basis in the first quarter of 2013 compared to the
first quarter
2012. 
Gross Margin 
On a year-on-year basis, the increase in Nokia Siemens Networks'
non-IFRS gross
margin in the first quarter 2013 was primarily due to a
higher gross margin in
Mobile Broadband and Global Services, as well
as a higher proportion of Mobile
Broadband within the total sales
mix. 
On a sequential basis, the decrease in Nokia Siemens Networks'
non-IFRS gross
margin in the first quarter 2013 was due to a lower
gross margin in Global Services as well as the absence of
non-recurring IPR income of approximately EUR 30 million that was
recognized in the fourth quarter 2012, partially offset by
higher
gross margin in Mobile Broadband. 
Operating Expenses 
Nokia Siemens Networks' non-IFRS research and development expenses
decreased
16% year-on-year in the first quarter 2013 primarily due to
reduced investments
in business activities that are not consistent
with the company's focused strategy as well as increased research and
development efficiency, partially
offset by investments in areas that
are consistent with the company's focused
strategy most notably LTE.
Sequentially, Nokia Siemens Networks' non-IFRS research and
development expenses decreased 8% primarily due to lower
incentive
expenses. 
Year-on-year, Nokia Siemens Networks' non-IFRS sales and marketing
expenses decreased 22% in the first quarter 2013 primarily due to
structural cost savings. On a sequential basis, Nokia Siemens
Networks non-IFRS sales and marketing expenses decreased 15% in the
first quarter 2013 primarily due to lower incentive expenses and
seasonally lower marketing spend. 
Nokia Siemens Networks' non-IFRS administrative and general expenses
decreased
21% year-on-year in the first quarter 2013 primarily due to
structural cost savings. On a sequential basis, Nokia Siemens
Networks non-IFRS administrative
and general expenses decreased 5% in
the first quarter 2013, primarily due to
lower incentive expenses. 
Nokia Siemens Networks' non-IFRS other income and expense for the
first quarter
2013 was an income of EUR 7 million, compared to income
of EUR 6 million in the
first quarter 2012 and expense of EUR 16
million in the fourth quarter 2012.  On a sequential basis, this was
primarily due to a net negative impact related to
foreign currency
fluctuations. 
Non-IFRS Operating Margin 
In the first quarter 2013, non-IFRS operating margin for Mobile
Broadband was
higher than non-IFRS operating margin for Global
Services. 
The year-on-year increase in Nokia Siemens Networks non-IFRS
operating margin in the first quarter 2013 was primarily due to higher
gross margin and lower operating expenses as a percentage of net
sales. 
On a year-on-year basis, non-IFRS operating margin increased for both
Mobile
Broadband and Global Services. 
The sequential decrease in Nokia Siemens Networks non-IFRS operating
margin in
the first quarter 2013 was primarily due to higher operating
expenses as a percentage of net sales and lower gross margin. 
On a sequential basis, non-IFRS operating margin decreased for both
Mobile Broadband and Global Services. 
Operating Margin 
The year-on-year increase in Nokia Siemens Networks operating margin
in the first quarter 2013 was primarily due to lower other income and
expenses as a
percentage of net sales, higher gross margin and lower
operating expenses as a percentage of net sales. 
The sequential decrease in Nokia Siemens Networks operating margin in
the first
quarter 2013 was primarily due to higher operating expenses
as a percentage of
net sales and lower gross margin, partially offset
by lower other income and
expenses as a percentage of net sales. 
Global Restructuring Program 
The following table sets forth a summary of Nokia Siemens Networks'
cost reduction activities and planned operational adjustments. 


 
+----------------------------------------------------------------
---------+
|NOKIA SIEMENS NETWORKS RESTRUCTURING SUMMARY                             |
+------------+---------+----------+---------+---------+---------+---------+
|EUR         |  Q1/2013|Cumulative|  Q2/2013|     2013|    2014 |   Total |
|(million)   |(approxi-|     up to|(approxi-|(approxi-|(approxi-|(approxi-|
|            |    mate)|   Q1/2013|     mate|     mate|     mate|     mate|
|            |         | (approxi-| estimate|         |estimate)| estimate|
|            |         |     mate)|         |         |         |         |
+------------+---------+----------+---------+---------+---------+---------+
|Restructu-  |      129|     1 400|      Not|      Not|      Not|    1 400|
|ring related|         |          | provided| provided| provided|         |
|charges     |         |          | 
        |         |         |         |
+------------+---------+----------+---------+---------+---------+---------+
|Restructu-  |         |          |         |         |         |         |
|ring related|      130|       800|      200|      550|      200|    1 400|
|cash        |         |          |         |         |         |         |
|outflows    |         |          |         |         |         |         |
+------------+---------+----------+---------+---------+---------+---------+

 
As Nokia Siemens Networks executes its restructuring plans, the
company is continuing to consider options as part of its
transformation and restructuring
program which may impact
restructuring related charges and related cash outflows
in the
remainder of 2013. 
Nokia and Nokia Siemens Networks continue to target to reduce Nokia
Siemens Networks' non-IFRS annualized operating expenses and
production overheads by
more than EUR 1 billion by the end of 2013,
compared to the end of 2011. In conjunction with this restructuring
program, Nokia and Nokia Siemens Networks
estimates total
restructuring related charges of approximately EUR 1.4 billion
as
well as total restructuring related cash outflows of approximately
EUR 1.4
billion. This is an update to the earlier estimate of
approximately EUR 1.3 billion for both restructuring related charges
as well as restructuring related
cash outflows. 
At the end of the first quarter 2013, Nokia Siemens Networks had
approximately
56 700 employees, a reduction of approximately 11 900
compared to the end of the first quarter 2012, and approximately 1
700 compared to the end of the fourth
quarter 2012. 
Q1 OPERATING HIGHLIGHTS 
DEVICES & SERVICES OPERATING HIGHLIGHTS 
SMART DEVICES 
- Nokia started shipping the Nokia Lumia 620, a compact smartphone
with a colorful design that brings Windows Phone 8 to a more youthful
audience. 
- Nokia announced the Lumia 520, its most affordable Windows Phone 8
smartphone,
delivering experiences normally found only in high-end
smartphones, such as the
same digital camera lenses found on the
flagship Nokia Lumia 920, Nokia Music
for free music out of the box
and even offline, and the HERE location suite. 
- Nokia announced and started shipping the Nokia Lumia 720, a
midrange Windows
8 smartphone with high-end camera performance
featuring a large f/1.9 aperture
and exclusive Carl Zeiss optics
designed to deliver clear pictures day and night. The sleek and
stylish smartphone comes with the latest high-end Nokia
Lumia
experiences, including Nokia Music, the HERE location suite, and the
option to add wireless charging with a snap-on wireless charging
cover. 
- Nokia's Lumia range of smartphones continued to attract businesses,
including
Foxtons, London's leading estate agent, which has chosen
the Nokia Lumia 820 as its business smartphone; Mall of America, the
United States' largest retail and
entertainment complex, which is
switching from BlackBerry to the Nokia Lumia
920 because of the tight
integration with Microsoft services and built-in Microsoft Office
suite; and The Coca-Cola Company, whose sales associates in
Vietnam
and Cambodia are using Nokia Lumia smartphones for order
processing,
equipment validation and market execution improvement. 
- The Windows Phone Store continued to strengthen in terms of the
quantity and
quality of applications. Windows Phone offers more than
135 000 applications and games. Key new applications that arrived in
Store during the quarter included
Pandora, United Airlines and Temple
Run. 
MOBILE PHONES 
- Nokia announced the Nokia 301, the most affordable Nokia device to
offer video
streaming; it also comes with new smart camera features
inspired by the digital
camera lenses on Nokia's Lumia smartphones. 
- Nokia announced the Nokia Asha 310, which provides Dual SIM and
Wi-Fi in the
same device, a first for Nokia smartphones. 
- Nokia announced the Nokia 105, its most affordable phone to date,
retailing at a recommended price of EUR 15. The Nokia 105 is the
ideal device for the first-time phone buyer, featuring a bright color
screen with clear menus and
essentials like FM radio, multiple alarm
clocks, speaking clock and flashlight.
The dust- and splash-proof,
pillowed keymat and battery life of up to 35 days
also make it ideal
for people in search of a reliable back-up phone. 
HERE OPERATING HIGHLIGHTS 
In the first quarter 2013, HERE continued to strengthen its offering
on Nokia's
Lumia range as well as broaden the experiences available
across the Windows Phone 8 ecosystem: 
- HERE further integrated its location-based experiences to enable
people to
seamlessly transition from driving to walking to public
transit thanks to improved app-to-app linking and syncing of
favorites from here.com to any HERE
experience. HERE now also offers
unique capabilities for users to customize their home screen as a
personal location dashboard. 
- With LiveSight technology, HERE introduced innovation that is aimed
at changing the way people interact with maps, and their world. After
first showcasing the technology in the HERE City Lens application,
HERE also announced
that it is extending LiveSight to HERE Maps.
LiveSight recognizes what people
see through their phone's camera and
layers that view with relevant, place-based information. 
- HERE further strengthened the Windows Phone 8 ecosystem by making
its suite of location-based experiences available for non-Nokia
Windows Phone 8 devices. HERE
offers HERE Drive, HERE Maps and HERE
Transit to owners of non-Nokia Windows
Phone 8 devices in Canada,
France, Germany, Italy, Mexico, Spain, the United
Kingdom and the
United States. 
HERE also continued to broaden access to its maps content and the
HERE Platform
through several new partnerships, including: 
- Mozilla, which as a first collaborative step with HERE now has
HTML5-based HERE Maps for the new Firefox OS. 
- Toyota Motor Europe, which selected the HERE platform's Local
Search for Automotive to power its next generation Touch & Go
navigation and infotainment
systems. Local Search for Automotive is a
specifically designed solution developed to fulfill the requirements
of the automotive industry. This announcement marks a significant
advancement in our longstanding partnership
with Toyota and includes
plans to collaborate with Nokia to study more services
that leverage
the HERE Location Platform. 
- More than 10 companies decided to adopt the HERE Location platform,
including
Terra in Brazil and Tiscali and SEAT Pagine Gialle in
Italy, demonstrating that
the platform is gaining momentum across
industries. 
- Wetter.com, Europe's largest German language weather portal with 13
million
unique visitors, which is laying information from radar
stations and satellite
imagery on top of their HERE-powered map. For
instance, this enables people to
pinpoint where it is raining with
great precision. 
- Garmin, which is the first customer to launch Natural Guidance in
the U.S.
market and did so at the Consumer Electronics Show. Natural
Guidance provides
directions in a more humanized way with recognizable
landmarks, buildings, traffic lights and stop signs, such as "turn
right after the church" or "turn
left at the traffic light." 
- HERE continued to strengthen its long lasting relationships within
the automotive industry, with a number of companies deciding that they
would continue to benefit from our automotive grade quality maps by
selecting HERE as their partner for Map Updates. These included
FujitsuTEN Australia Limited, KIA
Europe, Mitsubishi Motor
Corporation (MMC), Nissan Mexico, Subaru Canada and
Volkswagen
Europe. 
NOKIA SIEMENS NETWORKS OPERATING HIGHLIGHTS 
- Nokia Siemens Networks Finance B.V. issued EUR 800 million Senior
Notes. Most
of the net proceeds from the offering of the Notes have
been used to prepay certain existing debt of Nokia Siemens Networks,
with the remaining proceeds to be used for general corporate
purposes. 
- Nokia Siemens Networks continued its mobile broadband deal momentum
into 2013, adding commercial LTE deals in the first quarter,
including: implementing
a 4G (LTE) network for Movistar Chile and
expanding its 3G network; delivering
US Cellular's second wave of 4G
(LTE) services; launching New Zealand's first
4G service with
Vodafone and upgrading its 2G and 3G networks; launching
voice
services for Bharti Airtel's 4G TD-LTE customers in Pune,
India; enabling Polkomtel to provide voice services with LTE in
Poland; extending Orange's network in Switzerland and preparing it
for 4G roll-out; modernizing and expanding E-Plus Group's GSM and
HSPA+ networks in Germany; being selected by BH Telecom to expand and
modernize its mobile network across the northern and eastern parts of
Bosnia and Herzegovina; providing GSM-Railway (GSM-R) infrastructure
for Polish Railways; implementing a 4G (LTE) network for SFR
and
upgrading its existing GSM and 3G networks in major French
cities; conducting a successful 4G (LTE) trial with Vodacom Tanzania;
and becoming sole supplier to
DOCOMO PACIFIC, a subsidiary of the
Japanese telecommunications operator NTT
DOCOMO, for an end-to-end 4G
LTE network in the U.S. territory of Guam. 
- Nokia Siemens Networks continues to invest to stay at the forefront
of mobile
broadband, and at Mobile World Congress in February,
announced Liquid Applications, the biggest base station
transformation since the launch of GSM
22 years ago. Liquid
applications turns base stations into an intelligent part
of a mobile
operator's network to serve and deliver local content.  Nokia Siemens
Networks also announced a collaboration with IBM to deliver this
new
platform, which allows mobile operators to create a truly unique
mobile experience, relieve the ever-increasing strain on network
infrastructure and
bring new Liquid Broadband solutions to market.
Nokia Siemens Networks and SK
Telecom are working together to
evaluate Liquid Applications in the operator's
LTE network. 
- In February, Nokia Siemens Networks extended its small cell
portfolio with new Flexi Zone Micro and Pico base stations for hot
spots complemented by new service offerings that together deliver
optimal coverage and capacity, and launched Smart Wi-Fi to seamlessly
integrate wireless local area networks (WLAN)
with mobile networks.
Nokia Siemens Networks also introduced a range of new features to its
Liquid Radio Software Suites to help operators address constantly
changing capacity demands. The improved set of features can help
release 35% of GSM spectrum for use by WCDMA and LTE, and ensure that
LTE networks and spectrum are fully utilized. 
- Nokia Siemens Networks was recognized by Global TD-LTE Initiative
(GTI) for
its global advances and deployments, winning the TD-LTE
Market Development Award
2013, with TD-LTE innovations allowing
operators to use their valuable spectrum
more effectively, serve more
customers profitably, and converge TD-LTE and FDD
LTE to meet steep
data demand. 
-  In January, Nokia Siemens Networks enabled the world's first live
TV broadcast via TD-LTE with China Mobile. The TD-LTE network, solely
built by Nokia Siemens Networks, exceeded requirements to transmit
high-definition (HD)
video and images from cameras on the move,
providing the best live TV experience, matching a relay via
satellite. 
- Nokia Siemens Networks and Panasonic Mobile Communications were
selected by
NTT DOCOMO in Japan to develop next-generation mobile
broadband network architecture for LTE-A (long term
evolution-advanced), and as part of a multi-year agreement that will
provide high-capacity base stations and Remote Radio Heads (RRH) for
small cells roll-out. 
- In services, Nokia Siemens Networks unveiled a suite of products
and services
at Mobile World Congress, to simplify operations for
mobile operators as underlying networks become increasingly complex.
Nokia Siemens Networks was selected by Lebanese telecommunications
operator, touch, to simplify its operations and improve its customer
experience. To achieve this, the operator
has selected Nokia Siemens
Networks' unique operations support systems (OSS)
portfolio and its
related integration services. The solution will transform touch's
service operations cost-efficiently and pave the way for the operator
to achieve service assurance. 
RISKS AND FORWARD-LOOKING STATEMENTS 
It should be noted that Nokia and its business are exposed to various
risks and
uncertainties and certain statements herein that are not
historical facts are
forward-looking statements, including, without
limitation, those regarding: A)
the expected plans and benefits of
our partnership with Microsoft to bring together complementary assets
and expertise to form a global mobile ecosystem
for smartphones; B)
the timing and expected benefits of our strategies, including
expected operational and financial benefits and targets as well
as
changes in leadership and operational structure; C) the timing of
the deliveries
of our products and services; D) our ability to
innovate, develop, execute and
commercialize new technologies,
products and services; E) expectations regarding
market developments
and structural changes; F) expectations and targets regarding our
industry volumes, market share, prices, net sales and margins of
our
products and services; G) expectations and targets regarding our
operational
priorities and results of operations; H) expectations and
targets regarding collaboration and partnering arrangements; I) the
outcome of pending and threatened litigation, regulatory proceedings
or investigations by authorities;
J) expectations regarding the
successful completion of  restructurings, investments, acquisitions
and divestments on a timely basis and our ability to
achieve the
financial and operational targets set in connection with any
such
restructurings, investments, acquisitions and divestments; and
K) statements
preceded by "believe," "expect," "anticipate,"
"foresee," "target," "estimate,"
"designed," "aim", "plans,"
"intends," "will" or similar expressions. 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, including risks and uncertainties
that could cause
these differences include, but are not limited to:
1) our ability to make the
Windows Phone ecosystem a competitive and
profitable global ecosystem that achieves sufficient scale, value and
attractiveness to relevant market participants, making Nokia products
with Windows Phone a competitive choice for
consumers; 2) our success
in the smartphone market, including our ability to
introduce and
bring to market quantities of attractive, competitively priced
Nokia
products with Windows Phone that are positively differentiated from
our
competitors' products, both outside and within the Windows Phone
ecosystem; 3)
our ability to produce attractive and competitive
devices in our Mobile Phones
business unit, including feature phones
and devices with features such as full
touch that can be categorized
as smartphones, in a timely and cost efficient
manner with
differentiated hardware, software, localized services and
applications; 4) the success of our HERE strategy, including our
ability to establish a successful location-based platform and extend
our location-based services across devices and operating systems; 5)
our ability to provide support for our Devices & Services business and
maintain current and create new sources of revenue from our
location-based service and commerce assets; 6) our ability
to protect
numerous patented standardized or proprietary technologies from
third-party infringement or actions to invalidate the intellectual
property rights of these technologies; 7) our ability to maintain the
existing sources of intellectual property related revenue and
establish new such sources; 8) the
intensity of competition in 
the
various markets where we do business and our
ability to maintain or
improve our market position or respond successfully to
changes in the
competitive environment; 9) our ability to keep momentum and increase
our speed of innovation, product development and execution in order
to bring new innovative and competitive mobile products and
location-based or other
services to the market in a timely manner;
10) the success of our partnership
with Microsoft in connection with
the Windows Phone ecosystem; 11) our ability
to effectively and
smoothly implement the planned changes in our operational
structure
and achieve targeted efficiencies and reductions in operating
expenses; 12) our ability to retain, motivate, develop and recruit
appropriately
skilled employees; 13) our dependence on the
development of the mobile and communications industry, including
location-based and other services industries,
in numerous diverse
markets, as well as on general economic conditions globally
and
regionally; 14) our ability to maintain and leverage our traditional
strengths in the mobile products market, especially if we are unable
retain the
loyalty of our mobile operator and distributor customers
and consumers as a result of the implementation of our strategies or
other factors; 15) the performance of the parties we partner and
collaborate with, including Microsoft
and our ability to achieve
successful collaboration or partnering arrangements;
16) our ability
to deliver our mobile products profitably, in line with
quality
requirements and on time, especially if the limited number of
suppliers we depend on, many of which are geographically concentrated
with a majority  based
in Asia, fail to deliver sufficient quantities
of fully functional products,
components, sub-assemblies, software
and services on favorable terms and in compliance with our supplier
requirements; 17) 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 services; 18) any actual or
even
alleged defects or other quality, safety and security issues in our
products; 19) any inefficiency, malfunction or disruption of a system
or network
that our operations rely on; 20) the impact of
cybersecurity breach or other
factors leading to an actual or alleged
loss, improper disclosure or leakage of any personal or consumer data
collected by us or our partners or subcontractors,
made available to
us or stored in or through our products; 21) our ability
to
successfully manage the pricing of our products and costs related
to our products and our operations; 22) the potential complex tax
issues and obligations we may face, including the obligation to pay
additional taxes in
various jurisdictions and our actual or
anticipated performance, among other
factors, could result in
allowances related to deferred tax assets; 23) exchange
rate
fluctuations, particularly between the euro, which is our reporting
currency, and the US dollar, the Japanese yen and the Chinese yuan,
as well as
certain other currencies; 24) our ability to protect the
technologies, which we or others develop or which 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 product and services; 25) the
impact of economic, regulatory, political or other development
on our
sales, manufacturing facilities and assets located in emerging
market
countries as well as the impact of regulations against imports
to those countries; 26) the impact of changes in and enforcement of
government policies,
technical standards, trade policies, laws or
regulations in countries where our
assets are located and where we do
business; 27) investigations or claims by
contracting parties in
relation to exits from countries, areas or contractual
arrangements;
28) unfavorable outcome of litigation, regulatory proceedings
or
investigations by authorities; 29) allegations of possible health
risks from
electromagnetic fields generated by base stations and
mobile devices, and the
lawsuits and publicity related to them,
regardless of merit; 30) Nokia Siemens
Networks' success in the
mobile broadband infrastructure and related services
market and its
ability to effectively, profitably and timely adapt business
and
operations to the diverse needs of its customers; 31) Nokia
Siemens Networks'
ability to maintain and improve its market position
and respond successfully to changes and competition in the mobile
broadband infrastructure and related services market; 32) Nokia
Siemens Networks' success in implementing its restructuring plan and
reducing its operating expenses and other costs; 33) Nokia Siemens
Networks' ability to invest in and timely introduce new competitive
products, services, upgrades and technologies; 34) Nokia
Siemens
Networks' dependence on limited number of customers and
large, multi-year contracts; 35) Nokia Siemens Networks' liquidity
and its ability to meet its
working capital requirements, including
access to available credit under its
financing arrangements and other
credit lines as well as cash at hand; 36) the
management of Nokia
Siemens Networks' customer financing exposure; 37) whether
ongoing or
any additional governmental investigations of alleged violations
of
law by some former employees of Siemens may involve and affect the
carrier-related assets and employees transferred by Siemens to Nokia
Siemens Networks; 38) any impairment of Nokia Siemens Networks
customer relationships resulting
from ongoing or any additional
governmental investigations involving the Siemens
carrier-related
operations transferred to Nokia Siemens Networks, as well as the risk
factors specified on pages 12-47 of Nokia's annual report on Form
20-F for
the year ended December 31, 2012 under Item 3D. "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
publicly
update 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 18, 2013 
Planned publication dates for Nokia Corporation interim reports in
2013 
- second quarter 2013 interim report: July 18, 2013 
- third quarter 2013 interim report: October 17, 2013 
Nokia Siemens Networks standalone financial reports 
As announced in March 2013, Nokia Siemens Networks Finance B.V.
issued EUR 800
million Senior Notes. As a result of this transaction
and in line with terms and conditions that commensurate with the
nature of these debt securities, Nokia
Siemens Networks has agreed to
make certain financial data publicly available on its new standalone
reporting format that was introduced in the Nokia Siemens
Networks
annual report for 2012. For standalone financial reporting
purposes,
Nokia Siemens Networks currently has two operating
segments: Mobile Broadband
and Global Services. Nokia Siemens
Networks provides detailed disclosure of certain financial
information for these operating segments. For Nokia Group financial
reporting purposes Nokia Siemens Networks remains as one
reportable
segment. The classification of certain items presented on
Nokia Siemens Networks
standalone financial statements differ from
the Nokia Group presentation. Certain additional disclosures are also
required to be presented on a standalone
basis. The standalone report
will be made publicly available for the first, second and third
quarter of the fiscal year within 60 days following the end of
respective quarter and for the full year within 120 days after the
end of the
fiscal year. This obligation continues for as long as the
notes are outstanding. 
In line with the above, the Nokia Siemens Networks standalone
financial report
for the first quarter 2013 will be published before
the end of May 2013. Nokia
Siemens Networks plans to announce a more
precise publication date in due course. 
Nokia's Annual General Meeting 
Nokia's Annual General Meeting 2013 will be held on May 7, 2013. 
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants
that: 
(i) the releases contained herein are protected by copyright and    
other applicable laws; and 
(ii) they are solely responsible for the content, accuracy and     
originality of the information contained therein. 
Source: NOKIA via Thomson Reuters ONE 
[HUG#1694064] 
Media and Investor Contacts:
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email: press.services@nokia.com
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www.nokia.com