Nokia's 40% year-on-year device volume growth drives 29% net sales growth, 32% EPS growth and strong market share gains

April 20, 2006

5 Min Read

ESPOO, Finland -- Table 1:

EUR million

Q1/2006*

Q1/2005**

Change (%)

Net sales

9 507

7 396

29

Mobile Phones

5 869

4 527

30

Multimedia

1 758

1 133

55

Enterprise Solutions

186

307

-39

Networks

1 699

1 431

19

Operating profit

1 367

1 118

22

Mobile Phones

1 085

869

25

Multimedia

323

155

108

Enterprise Solutions

-66

-9

Networks

149

221

-33

Common Group Expenses

-124

-118

Operating margin (%)

14.4

15.1

Mobile Phones (%)

18.5

19.2

Multimedia (%)

18.4

13.7

Enterprise Solutions (%)

-35.5

-2.9

Networks (%)

8.8

15.4

Net profit

1 048

863

21

EPS, EUR

Basic

0.25

0.19

32

Diluted

0.25

0.19



FIRST QUARTER 2006 HIGHLIGHTS

  • Industry quarterly device volumes of 215 million units, down 12% sequentially and up 27% year on year, based on our preliminary market estimate.

  • Nokia quarterly device volumes of 75.1 million units, down 10% sequentially and up 40% year on year.

  • Nokia first quarter device market share of 35%, up 1 percentage point sequentially and up 3 percentage points year on year, based on our preliminary market estimate.

  • Nokia's net sales in the United States almost doubled year on year.

  • Device ASPs of EUR 103, up sequentially from EUR 99 in the fourth quarter 2005.



JORMA OLLILA, CHAIRMAN AND CEO:
"Nokia had an excellent quarter, with very strong year on year volume, net sales and EPS growth. A robust market coupled with our strong product portfolio and excellent execution produced outstanding results in a seasonally challenging first quarter. And our device market share of 35% in the first quarter - an increase of three percentage points year on year - further reinforces our number one position globally.

Nokia continues to benefit from a diversifying product offering in terms of form and function, led by a greater variety of devices in our mid-range offering. I am also delighted that our strategy to target new mobile communications market segments is working well, as evidenced by the success of the Nokia N70 multimedia device: the highest revenue generator for Nokia this quarter and the world's number one selling WCDMA device."

OLLI-PEKKA KALLASVUO, PRESIDENT AND COO:
"The global device market is set for another year of good growth, with the market volume expected to increase 15% or more. This year we anticipate approximately 70% of industry volume growth to come from the emerging markets. We intend to maintain our leadership in these fastest growing markets, where being competitive in the lower priced entry level products is critical to Nokia's future success. Our infrastructure business is also extremely important to our overall growth strategy, and we're very pleased with the sales developments we see from this business group."

INDUSTRY AND NOKIA OUTLOOK FOR THE SECOND QUARTER AND FULL YEAR 2006

  • Nokia expects industry mobile device volumes in the second quarter 2006 to be up sequentially.

  • We expect Nokia's device market share in the second quarter 2006 to be approximately at the same level sequentially.

  • Sales in our networks business are expected to develop according to normal seasonality in the second quarter 2006.

  • Nokia continues to expect the mobile device market volume to grow 15% or more in 2006, from our estimate of approximately 795 million units in 2005.

  • We continue to expect the device industry to experience value growth in 2006, but expect some decline in industry ASPs, primarily reflecting the increasing impact of the emerging markets and competitive factors in general.

  • Nokia continues to expect moderate growth in the mobile infrastructure market in euro terms in 2006.

  • Nokia continues to target an increase in its 2006 market share in mobile devices and infrastructure.



Nokia Corp. (NYSE: NOK)

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