Nokia sets key financial targets and Devices & Services operational priorities for 2010

Thursday, December 3, 2009


Helsinki, Finland - Today, at its annual Capital Markets Day event, Nokia set key targets and forecasts for the company and its industry for 2010. Senior company executives outlined how Nokia's focus on execution combined with its core competitive advantages, position the company to achieve and sustain broad-based success in the mobile devices market. At the event, Nokia also demonstrated significant improvements to its forthcoming version of the Symbian user interface.

Nokia CEO, Olli-Pekka Kallasvuo, highlighted Nokia's focus on user experience, stating: "In 2010, we will drive user experience improvements, and the progress we make will take the Symbian user interface to a new level. As an operating system, Symbian has reach and flexibility like no other platform, and we have measures in place to push smartphones down to new price points globally, while growing margins. I see great opportunity for Nokia to capture new growth in our industry, by creating what we expect to be the world's biggest platform for services on the mobile."

Nokia CFO, Timo Ihamuotila, described Nokia's view of the industry and competitive environment: "Going into 2010, the overall mobile devices market is stabilizing and it is growing more in the areas where Nokia has competitive advantages. We believe that by executing on the operational priorities we have set, Nokia will be competitive in both mobile phones and smartphones and will improve its value share."

Targets and forecasts for Nokia and the mobile device industry

- Nokia expects industry mobile device volumes to be up approximately 10% in 2010, compared to 2009.
- Nokia targets its mobile device volume market share to be flat in 2010, compared to 2009.
- Nokia targets lower average selling price (ASP) erosion of its mobile devices in 2010, compared to recent years.
- Nokia targets to increase its mobile device value market share slightly in 2010, compared to 2009.
- Nokia targets non-IFRS* operating expenses in Devices & Services of approximately EUR 5.7 billion in 2010.
- Nokia targets bringing Devices & Services non-IFRS* research and development expenses below 10% of net sales in 2010.
- Nokia targets Devices & Services non-IFRS* operating margin of 12% to 14% in 2010.
- Nokia continues to target Services net sales of EUR 2 billion or more in 2011.
- Nokia continues to target to have 300 million active users for its services by the end of 2011.

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

- Nokia and Nokia Siemens Networks expect a flat market in euro terms for the mobile and fixed infrastructure and related services market in 2010, compared to 2009.
- Nokia and Nokia Siemens Networks target for Nokia Siemens Networks to grow faster than the market in 2010.
- Nokia and Nokia Siemens Networks continue to target Nokia Siemens Networks to reduce its non-IFRS* annualized operating expenses and production overheads by EUR 500 million by the end of 2011, compared to the end of 2009.
- Nokia and Nokia Siemens Networks target Nokia Siemens Networks non- IFRS* operating margin of breakeven to 2% in 2010.

Additional financial targets
- Nokia and NAVTEQ target NAVTEQ operating margin to be higher than Devices & Services operating margin in 2010, on a non-IFRS* basis.
- Nokia targets its financial income and expense to be approximately EUR 250 million expense in 2010.

Nokia Devices & Services operational priorities
In addition to providing its key financial targets, Nokia also outlined key Devices & Services operational priorities for 2010. These are:
- Improve our user experience;
- Re-engineer our Symbian user interface; deliver a major product milestone before mid-year 2010, and another major product milestone before the end of 2010;
- Deliver our first Maemo 6-powered mobile computer, with an iconic user experience, in the second half of 2010;
- Significantly increase the proportion of touch and/or QWERTY devices in our smartphone portfolio;
- Scale up our Services business by expanding geographically and in partnership with more operators;
- Provide third party developers with better tools to create applications and content for our Ovi ecosystem;
- Further optimize the industry's lowest cost end-to-end business model in Mobile Phones; and
- Continue to build on our affordable and localized services offerings for emerging market consumers.
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