Recasting of Nokia quarterly and full year 2010 and first, second and third quarter 2011 results

Nokia Corporation
Stock exchange release
January 25, 2012 at 15:00 (CET +1)
Espoo, Finland - Nokia provided historical results for its Devices & Services and Location & Commerce businesses, recasted for comparability purposes according to the new reporting format that became effective on October 1, 2011, as a result of the formation of the Location & Commerce business which combines NAVTEQ and Nokia's social location services operations from Devices & Services. The recast also reflects certain regroupings within Devices & Services to conform with the current reporting structure.
The historical results set forth below for each quarter and the full year of 2010 as well as the first, second and third quarter of 2011 are reported results recasted (on an unaudited basis) for comparability purposes according to Nokia's four reportable segments effective from October 1, 2011:
- Smart Devices (within Devices & Services)
- Mobile Phones (within Devices & Services)
- Location & Commerce
- Nokia Siemens Networks
The key financial performance measures provided for these segments include net sales, gross margin as well as an additional measure of profit. For Smart Devices and Mobile Phones, we present these segments' profit contribution, which consists of revenues less these segments' own costs as well as their directly assignable and allocated costs. For Location & Commerce and Nokia Siemens Networks, we present operating profit.
The most significant amounts transferred relate to operating expenses which were previously in Devices & Services Other - specifically, those relating to social location services operations - to Location & Commerce. In order to consistently reflect where the economic value of location services is created, the recast also impacted Cost of Sales by reportable segment. Amounts previously in Devices & Services Other Cost of Sales and Smart Devices Cost of Sales were transferred to Location & Commerce Cost of Sales. As a consequence of the higher value add performed in Location & Commerce, the recasted numbers also reflect a higher internal transfer price, which impacted Location & Commerce Net Sales positively and Smart Devices Cost of Sales negatively. The internal transfer price represents Net Sales to Location & Commerce and Cost of Sales to Smart Devices. Location & Commerce will be responsible for developing the services going forward whereas the services will continue to be delivered to customers and consumers by Devices & Services in combination with our devices. In order to consistently reflect deferral of services revenue over the service period, the recast also impacted Location & Commerce revenue and corporate Eliminations.
It should be noted that the information provided herein is historical and therefore does not indicate future performance.
FIRST QUARTER 2010, REPORTED, EUR million
(unaudited)
Smart
Device
s 1-
3/201
0 Mobile
Phone
s 1-3/201
0 Devices &
Services
other 1-
3/2010 Devices
& Service
s 1-
3/2010 Location
& Commer
ce 1-
3/2010 Nokia
Siemens
Networks
1-3/2010 Corpor
ate Commo
n 1-3/2010 Elimi
natin
ns 1-
3/2010 Nokia
Group
1-3/2010
Net sales 3,363 3,194 107 6,664 193 2,718 - -53 9,522
Cost of sales -2,243 -2,233 -55 -4,531 -30 -1,936 - 53 -6,444
Gross profit 1,120 961 52 2,133 163 782 - - 3,078
% of net
sales 33.3 30.1 48.6 32.0 84.5 28.8 32.3
Operating
expenses -846 -341 -107 -1,294 -306 -1,015 -12 - -2,627
Other income
and expenses 28 - 9 37 1 7 -8 - 37
Contribution 302 620 -46
% of net
sales 9.0 19.4 -43.0
Operating
profit 876 -142 -226 -20 - 488
% of net
sales 13.1 -73.6 -8.3 5.1

SECOND QUARTER 2010, REPORTED, EUR million
(unaudited)
Smart
Devices 4-
6/2010 Mobile
Phones 4-
6/2010 Devices &
Services other 4-
6/2010 Devices
& Services
4-6/2010 Location
& Commerce 4-
6/2010 Nokia
Siemens
Networks
4-6/2010 Corporate
Common 4-
6/2010 Elimin
ations 4-
6/2010 Nokia
Group
4-6/2010
Net sales 3,503 3,190 105 6,798 208 3,039 - -42 10,003
Cost of
sales -2,389 -2,304 -60 -4,753 -51 -2,170 - 42 -6,932
Gross
profit 1,114 886 45 2,045 157 869 - - 3,071
% of
net sales 31.8 27.8 42.9 30.1 75.5 28.6 30.7
Operati
ng expenses -862 -374 -115 -1,351 -360 -1,034 -29 - -2,774
Other
income and expens
es 2 1 16 19 -3 -14 -4 - -2
Contrib
ution 254 513 -54
% of
net sales 7.3 16.1 -51.4
Operating
profit 713 -206 -179 -33 - 295
% of
net sales 10.5 -99.0 -5.9 2.9

THIRD QUARTER 2010, REPORTED, EUR million
(unaudited)
Smart
Devices 7-
9/2010 Mobile
Phones 7-
9/2010 Devices &
Services
other 7-
9/2010 Devices
& Services
7-
9/2010 Location
& Commerc
e 7-
9/2010 Nokia
Siemens
Networks
7-9/2010 Corporate
Common 7-
9/2010 Elimin
ations 7-
9/2010 Nokia
Group
7-
9/2010
Net
sales 3,612 3,364 197 7,173 203 2,943 - -49 10,270
Cost of
sales -2,522 -2,506 -68 -5,096 -42 -2,241 1 49 -7,329
Gross
profit 1,090 858 129 2,077 161 702 1 - 2,941
% of net
sales 30.2 25.5 65.5 29.0 79.3 23.9 28.6
Operatin
g expenses -785 -383 -105 -1,273 -329 -966 -19 - -2,587
Other
income and
expenses 5 3 57 65 1 -18 1 - 49
Contrib
ution 310 478 81
% of net
sales 8.6 14.2 41.1
Operati
ng profit 869 -167 -282 -17 - 403
% of net sales 12.1 -82.3 -9.6 3.9

FOURTH QUARTER 2010, REPORTED, EUR million
(unaudited)
Smart
Devices
10-
12/2010 Mobile
Phones
10-12/2010 Devices &
Services
other 10-
12/2010 Devices &
Services 10-12/2010 Location &
Commerce 10-12/2010 Nokia
Siemens
Networks
10-12/2010 Corporate
Common 10-
12/2010 Elimin
ations 10-
12/2010 Nokia
Group
10-
12/2010
Net
sales 4,396 3,948 155 8,499 265 3,961 - -74 12,651
Cost
of sales -3,133 -2,823 -76 -6,032 -46 -2,919 -1 74 -8,924
Gross
profit 1,263 1,125 79 2,467 219 1,042 -1 - 3,727
% of
net sales 28.7 28.5 51.0 29.0 82.6 26.3 29.5
Oper
ating expe
nses -899 -410 -125 -1,434 -365 -1,022 -46 - -2,867
Other
income and
expenses 146 1 -98 49 -2 -19 4 -8 24
Contr
ibution 510 716 -144
% of
net sales 11.6 18.1 -92.9
Oper
ating profi
t 1,082 -148 1 -43 -8 884
% of
net sales 12.7 -55.8 0.0 7.0

FULL YEAR 2010, REPORTED, EUR million
(unaudited)
Smart
Devices
1-
12/2010 Mobile
Phones
1-
12/2010 Devices
&
Services other 1-
12/2010 Devices
& Services
1-
12/2010 Location
&
Commerce 1-
12/2010 Nokia
Siemens
Networks
1-
12/2010 Corporate
Common 1-
12/2010 Eliminatio
ns 1-12/2
010 Nokia
Group 1-
12/2010
Net
sales 14,874 13,696 564 29,134 869 12,661 - -218 42,446
Cost of
sales -10,287 -9,866 -259 -20,412 -169 -9,266 - 218 -29,629
Gross
profit 4,587 3,830 305 8,722 700 3,395 - - 12,817
% of
net sales 30.8 28.0 54.1 29.9 80.6 26.8 30.2
Operating
expenses -3,392 -1,508 -452 -5,352 -1,360 -4,037 -106 - -10,855
Other
income and expenses 181 5 -16 170 -3 -44 -7 -8 108
Contrib
ution 1,376 2,327 -163
% of
net sales 9.3 17.0 -28.9
Operating
profit 3,540 -663 -686 -113 -8 2,070
% of
net sales 12.2 -76.3 -5.4 4.9

FIRST QUARTER 2011, REPORTED, EUR million
(unaudited)
Smart
Devices 1-
3/2011 Mobile
Phones 1-
3/2011 Devices &
Services
other 1-
3/2011 Devices
& Services
1-3/2011 Location
&
Commerce 1-3/2011 Nokia
Siemens
Networks
1-3/2011 Corporate
Common 1-
3/2011 Elim
inations 1-3/2011 Nokia
Group 1-
3/2011
Net
sales 3,528 3,407 152 7,087 232 3,171 - -91 10,399
Cost of
sales -2,508 -2,456 -84 -5,048 -44 -2,324 - 91 -7,325
Gross
profit 1,020 951 68 2,039 188 847 - - 3,074
% of net
sales 28.9 27.9 44.7 28.8 81.0 26.7 29.6
Operating
expenses -834 -387 -104 -1,325 -321 -990 -22 - -2,658
Other
income and expense
s - -2 17 15 1 1 6 - 23
Contrib
ution 186 562 -19
% of net
sales 5.3 16.5 -12.5
Operati
ng profit 729 -132 -142 -16 - 439
% of net
sales 10.3 -56.9 -4.5 4.2

SECOND QUARTER 2011, REPORTED, EUR million
(unaudited)
Smart
Device
s 4-
6/2011 Mobile
Phones
4-6/2011 Devices &
Services
other 4-
6/2011 Devices
& Services
4-
6/2011 Location
& Commerc
e 4-6/2011 Nokia
Siemens
Networks
4-6/2011 Corporat
e Common
 4-6/2011 Elimin
ations  4-
6/2011 Nokia
Group 4-
6/2011
Net
sales 2,351 2,568 548 5,467 271 3,642 - -105 9,275
Cost of
sales -1,811 -1,933 -56 -3,800 -50 -2,698 - 105 -6,443
Gross
profit 540 635 492 1,667 221 944 - - 2,832
% of net
sales 23.0 24.7 89.8 30.5 81.5 25.9 30.5
Operating
expenses -752 -420 -95 -1,267 -325 -1,056 -51 - -2,699
Other
income
and expense
s -4 -1 -611 -616 - 1 -5 - -620
Contribution -216 214 -214
% of net
sales -9.2 8.3 -39.1
Operating
profit -216 -104 -111 -56 - -487
% of net sales -4.0 -38.4 -3.0 -5.3

THIRD QUARTER 2011, REPORTED, EUR million
(unaudited)
Smart
Device
s 7-9/2011 Mobile
Phones
7-
9/2011 Devices &
Services
other 7-
9/2011 Devices
& Services
7-
9/2011 Location
& Commerc
e 7-
9/2011 Nokia
Siemens
Networks
7-9/2011 Corporate
Common 7-
9/2011 Elimin
ations 7-
9/2011 Nokia
Group
7-
9/2011
Net
sales 2,194 2,915 283 5,392 282 3,413 - -107 8,980
Cost of
sales -1,739 -2,226 -43 -4,008 -52 -2,518 - 107 -6,471
Gross
profit 455 689 240 1,384 230 895 - - 2,509
% of net
sales 20.7 23.6 84.8 25.7 81.6 26.2 27.9
Operatin
g expense
s -656 -404 -67 -1,127 -314 -1,035 -37 -2,513
Other
income and expenses 11 10 -110 -89 -1 26 -3 -67
Contrib
ution -190 295 63
% of net
sales -8.7 10.1 22.3
Operatin
g profit 168 -85 -114 -40 - -71
% of net
sales 3.1 -30.1 -3.3 -0.8
About Nokia
Nokia is a global leader in mobile communications whose products have become an integral part of the lives of people around the world. Every day, more than 1.3 billion people use their Nokia to capture and share experiences, access information, find their way or simply to speak to one another. Nokia's technological and design innovations have made its brand one of the most recognized in the world. For more information, visit http://www.nokia.com/about-nokia