Nokia Capital Markets Day 2008

December 4, 2008

NEW YORK, December 4 /PRNewswire-FirstCall/ — Today, at its annual
Capital Markets Day event, Nokia (NYSE: NOK) lowered its forecast for mobile
device industry volumes for the fourth quarter 2008. Nokia also presented
forecasts for the company and the industry for 2009. At the event, senior
company executives outlined how Nokia’s strategy, robust financial structure
and competitive product portfolio are expected to ensure the company remains
in a position of strength in the more challenging economic times ahead.

Nokia President and CEO, Olli-Pekka Kallasvuo, highlighted the benefits
of Nokia’s brand, scale and number one market position, stating: “2009 will
be challenging for our industry, however we have a strong, enviable base to
build on and I believe we will continue to strengthen our position on many
fronts. Building on our operational flexibility, Nokia is acting to reduce
costs appropriately in the current slowing environment. At the same time, we
remain fully committed to making the investments to build the future of our
exciting industry and Nokia’s continued competitiveness.”

Nokia CFO, Rick Simonson, emphasized that appropriate cost reductions are
being effected now and are continuing in plans for 2009 and 2010: “Nokia’s
highly variable, low fixed cost business model allows us to scale to a
declining market. We are also acting on all fronts to reduce our costs beyond
what may be attributable solely to the scalable aspects of the business model
- moving to reduce cost of goods sold even further, reduce operational
expenditure appropriately, and scale back capital expenditure. We expect
these strong actions to offset, in part, the negative impact of slowing

Outlook for Nokia and the mobile device industry – fourth quarter 2008

The mobile device market slowdown has continued more rapidly than
previously expected since Nokia issued an update on November 14, 2008. The
industry continues to be impacted by the effects of a global consumer
pull-back in spending, currency volatility, and decreased availability of
credit. Nokia believes the slowdown is apparent in varying degrees across all
markets, while the most recent incremental impact in the emerging markets has
been more pronounced than in other markets. As a result, and while noting the
lack of visibility due to the factors cited above, Nokia is revising its
fourth quarter 2008 outlook as follows:

    - Nokia now estimates that fourth quarter 2008 industry mobile device
      volumes will be lower than the previous estimate of approximately 330
      million units, which would result in full year 2008 industry mobile
      device volumes below the earlier estimate of 1.24 billion units.

    - Nokia believes there is insufficient visibility in the marketplace to
      confirm its prior estimate for its fourth quarter 2008 mobile device
      market share, which was expected to be at the same level or slightly up
      from an estimated 38% in the third quarter 2008.

Outlook for Nokia Siemens Networks and the mobile infrastructure, fixed
infrastructure and related services market – 2008

    - Nokia and Nokia Siemens Networks continue to expect the mobile
      infrastructure, fixed infrastructure and related services market to be
      flat in euro terms in 2008, compared to 2007.

    - Nokia and Nokia Siemens Networks continued cost synergy target for
      Nokia Siemens Networks is to achieve substantially all of the EUR 2.0
      Billion of targeted annual cost synergies by the end of 2008.

Targets and forecasts for Nokia and the mobile device industry – 2009 and
going forward

    - Nokia expects that the mobile device market will continue to be
      negatively impacted by the effects of a slowdown in consumer spending.
      Nokia also expects that operator and retail distribution channels will
      go through a period of destocking, resulting in lower sales volumes by
      manufacturers (sell-in) than purchase volumes by consumers
      (sell- through) for the industry in the first half of 2009.

    - While noting the extremely limited visibility, Nokia expects 2009
      industry mobile device volumes to decline 5% or more from 2008 levels.

    - Nokia expects the four billion mobile subscriptions mark to be reached
      in the first quarter 2009.

    - Nokia targets an increase in its market share in mobile devices in 2009
      compared to 2008, including increased share in smartphones.

    - As previously announced, Nokia has adjusted its Internet services
      market focus to the areas of music, maps, media, messaging and gaming.
      Nokia estimates these targeted portions of the Internet services market
      will be approximately EUR 40 billion in 2011. In December 2007, Nokia
      estimated that the total Internet services market would be
      approximately EUR 100 billion in 2010.

    - Nokia targets Services & Software net sales of EUR 2 billion or more in

    - Nokia targets its Services & Software business to have 300 million
      unique services users by 2012.

Targets and forecasts for Nokia Siemens Networks and the mobile
infrastructure, fixed infrastructure and related services market – 2009

    - Nokia and Nokia Siemens Networks preliminary estimate is that the
      mobile infrastructure, fixed infrastructure and related services market
      will decline 5% or more in euro terms in 2009, from 2008 levels.

    - Nokia and Nokia Siemens Networks target for Nokia Siemens Networks
      market share to remain constant in 2009, compared to 2008.

Nokia financial targets (non-IFRS*) – 2009

Given the unprecedented environment, Nokia will not, at this time, be
giving operating margin targets for beyond 2009.

    - Nokia Devices & Services operating margin target to be in the teens in

    - NAVTEQ operating margin targeted to be somewhat above the Devices &
      Services operating margin in 2009.

    - Nokia Siemens Networks operating margin target to be in the single
      digits in 2009.

Nokia priorities for 2009

In addition to updating its financial targets, Nokia also outlined key
priorities for 2009. These are:

    - To ensure that Nokia's cost base is appropriately sized for a more
      challenging environment;

    - To grow mobile device market share, to capture growth opportunities in
      NAVTEQ and device enhancements, and to capture value from adjacent

    - To build on the momentum in Services & Software by continuing to grow
      and focus its services portfolio;

    - To mobilize consumer email and consumer instant messaging for millions
      of Nokia device users, and;

    - To further integrate and simplify Nokia's web services user interface
      and device user interface.

* 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 the
formation of Nokia Siemens Networks and from all business acquisitions
completed after June 30, 2008. For the preceding periods, non-IFRS results
exclude such items and

adjustments arising from the formation of Nokia Siemens Networks only.
Nokia believes that these non-IFRS financial measures provide meaningful
supplemental information to both management and investors regarding Nokia’s
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.

The main presentations at Nokia Capital Markets Day will be webcast live
at: http://investors.nokia.com

The breakout presentations at Nokia Capital Markets Day will be webcast
(archived) at: http://investors.nokia.com

Forward-Looking Statements

It should be noted that certain statements herein which are not
historical facts, including, without limitation, those regarding: A) the
timing of product, services and solution deliveries; B) our ability to
develop, implement and commercialize new products, services, solutions and
technologies; C) expectations regarding market growth, developments and
structural changes; D) expectations regarding our mobile device volume
growth, market share, prices and margins; E) expectations and targets for our
results of operations; F) the outcome of pending and threatened litigation;
G) expectations regarding the successful completion of contemplated
acquisitions on a timely basis and our ability to achieve the set targets
upon the completion of such acquisitions; and H) statements preceded by
“believe,” “expect,” “anticipate,” “foresee,” “target,” “estimate,”
“designed,” “plans,” “will” or similar expressions are forward-looking
statements. These statements are based on management’s best assumptions and
beliefs in light of the information currently available to it. Because they
involve risks and uncertainties, actual results may differ materially from
the results that we currently expect. Factors that could cause these
differences include, but are not limited to: 1) the deteriorating global
economic conditions and related financial crisis and their impacts on us, our
customers, suppliers, and collaborative partners; 2) competitiveness of our
product, service and solutions portfolio; 3) the extent of the growth of the
mobile communications industry; 4) the growth and profitability of the new
market segments that we target and our ability to successfully develop or
acquire and market products, services and solutions in those segments; 5) our
ability to successfully manage costs; 6) the intensity of competition in the
mobile communications industry and our ability to maintain or improve our
market position or respond successfully to changes in the competitive
landscape; 7) the impact of changes in technology and our ability to develop
or otherwise acquire complex technologies as required by the market, with
full rights needed to use; 8) timely and successful commercialization of
complex technologies as new advanced products, services and solutions; 9) our
ability to protect the complex technologies, which we or others develop or
that we license, from claims that we have infringed third parties’
intellectual property rights, as well as our unrestricted use on commercially
acceptable terms of certain technologies in our products, services and
solution offerings; 10) our ability to protect numerous Nokia and Nokia
Siemens Networks patented, standardized or proprietary technologies from
third-party infringement or actions to invalidate the intellectual property
rights of these technologies; 11) Nokia Siemens Networks’ ability to achieve
the expected benefits and synergies from its formation to the extent and
within the time period anticipated and to successfully integrate its
operations, personnel and supporting activities; 12) whether, as a result of
investigations into alleged violations of law by some current or former
employees of Siemens AG (“Siemens”), government authorities or others take
further actions against Siemens and/or its employees that may involve and
affect the carrier-related assets and employees transferred by Siemens to
Nokia Siemens Networks, or there may be undetected additional violations that
may have occurred prior to the transfer, or ongoing violations that may have
occurred after the transfer, of such assets and employees that could result
in additional actions by government authorities; 13) any impairment of Nokia
Siemens Networks customer relationships resulting from the ongoing government
investigations involving the Siemens carrier-related operations transferred
to Nokia Siemens Networks; 14) occurrence of any actual or even alleged
defects or other quality issues in our products, services and solutions; 15)
our ability to manage efficiently our manufacturing and logistics, as well as
to ensure the quality, safety, security and timely delivery of our products,
services and solutions; 16) inventory management risks resulting from shifts
in market demand; 17) our ability to source sufficient amounts of fully
functional components and sub-assemblies without interruption and at
acceptable prices; 18) any disruption to information technology systems and
networks that our operations rely on; 19) developments under large,
multi-year contracts or in relation to major customers; 20) economic or
political turmoil in emerging market countries where we do business; 21) our
success in collaboration arrangements relating to development of technologies
or new products, services and solutions; 22) the success, financial condition
and performance of our collaboration partners, suppliers and customers; 23)
exchange rate fluctuations, including, in particular, fluctuations between
the euro, which is our reporting currency, and the US dollar, the Chinese
yuan, the UK pound sterling and the Japanese yen, as well as certain other
currencies; 24) the management of our customer financing exposure; 25)
allegations of possible health risks from electromagnetic fields generated by
base stations and mobile devices and lawsuits related to them, regardless of
merit; 26) unfavorable outcome of litigations; 27) our ability to recruit,
retain and develop appropriately skilled employees; 28) the impact of changes
in government policies, laws or regulations; and 29) our ability to
effectively and smoothly implement our new organizational structure; as well
as the risk factors specified on pages 10-25 of Nokia’s annual report on Form
20-F for the year ended December 31, 2007 under “Item 3.D Risk Factors.”
Other unknown or unpredictable factors or underlying assumptions subsequently
proving to be incorrect could cause actual results to differ materially from
those in the forward-looking statements. Nokia does not undertake any
obligation to update publicly or revise forward-looking statements, whether
as a result of new information, future events or otherwise, except to the
extent legally required.


SOURCE Nokia Corporation

Source: newswire

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