Nokia (NOKIA) Status Update summary

Strategy and market positioning

• Aligning to deliver critical networks for CSPs, enterprises and webscales; targeting technology leadership in chosen segments.

• Addressable market for critical networks expanding as mission-critical connectivity extends across society.

• Value expected to shift from monolithic systems to silicon, cloud-native software and services; open solutions and as-a-service models gaining importance.

• Priorities include ORAN and vRAN, virtualized cloud-native core networks, long-term research, innovation and patent leadership.

Operating model and outlook

• New operating model takes effect Jan. 1, 2021; detailed business group strategies scheduled for Capital Markets Day on March 18, 2021.

• Previously provided 2020 and 2021 outlook remains unchanged; 2021 comparable operating margin expected at 7–10%.

• Recast 2020 comparative segment results planned by mid-March 2021; comparable results exclude acquired-intangible amortization, restructuring and other items affecting comparability.

2021 business group expectations

• Mobile Networks: comparable operating margin ~0%; turnaround and 5G leadership recovery focus, with significant longer-term improvement expected.

• Network Infrastructure: comparable operating margin in the high-single-digit range; gradual longer-term improvement expected.

• Cloud and Network Services: comparable operating margin in the mid-single-digit range; significant longer-term improvement expected.

• Nokia Technologies: slight improvement in comparable operating profit vs. 2020; stable longer-term performance expected.

• Group Common and Other: comparable operating loss ~€200 million; costs to be run lean and embedded in business groups where possible.