Nokia on track to reach third quarter profit guidance on slightly lower sales
press.nokia.com
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Nokia today provided a mid-quarter update on the company's business outlook for the third quarter, 2001. The company expects to reach its third
quarter profit estimate made on July 19.
Nokia continues to maintain market leadership without compromising profitability even in today's turbulent market conditions. Based on
developments during the first two months of the quarter, third quarter pro forma operating margin for the Nokia Group is expected to be in the
mid-teens, and pro forma EPS (diluted) for the third quarter to be within the earlier communicated range of EUR 0.14-0.16. However, Nokia expects
revenue for the third quarter to be about 5% lower than the third quarter last year, compared with earlier expectations of 0 to 5% year-on-year
growth.
The company continues to build on leading market positions in its two main businesses, mobile network infrastructure and mobile phones, which
have been subject to different dynamics during recent months.
Nokia Mobile Phones revenues are expected to be approximately at the same level as in the third quarter of 2000. Driven by leading products,
successful execution and strong brand, Nokia Mobile Phones has been able to maintain healthy margins even in the seasonally weaker third
quarter. Demand is showing signs of picking up in the US, and the Asian market continues to show a solid performance. During the coming
months, Nokia plans to introduce several new phone models.
On the infrastructure side, the ongoing technology transition from mobile voice to mobile data together with the economic instability have
increased uncertainty, as some operators are reassessing the timing of their GSM network investments. This is expected to result in lower
year-on-year sales and profitability for Nokia Networks in the third quarter.
Nokia will report its third quarter earnings on October 19, 2001, and plans to make a mid-quarter update for the fourth quarter on December 11.
A conference call has been scheduled for today at 16:00 Helsinki time (9 a.m. in EST). To access the conference call please visit
www.nokia.com/investor.
It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding 1) the timing of
product deliveries; 2) the Company´s ability to develop and implement new products and technologies; 3) expectations regarding market growth
and developments; 4) expectations for growth and profitability; and 5) statements preceded by "believes", "expects", "anticipates", "foresees",
or similar expressions, are forward-looking statements. Because such statements involve risks and uncertainties, actual results may differ
materially from the results currently expected by the Company. Factors that could cause such differences include, but are not limited to 1)
industry conditions, such as the strength of product demand, the intensity of competition, pricing pressures, the acceptability of new product
introductions such as Internet-ready phones, the introduction of new products by competitors, the impact of changes in technology, including
the Company's success in the emerging 3G market, the introduction and marketing of new products and services by operators, the ability of the
Company to source components from third parties without interruption and at reasonable prices, demand for vendor financing and the
Company's ability and willingness to provide such financing and to mitigate the related exposure, and the success and financial condition of the
Company´s strategic partners and customers; 2) operating factors, such as continued success of manufacturing activities and the achievement of
manufacturing efficiencies therein, continued success of product development and inventory risks due to shifts in market demand; 3) general
economic conditions, such as the rate of economic growth in the Company's principal geographic markets and in the wireless telecommunications
industry as a whole, and fluctuations in exchange rates, including in particular the impact of the exchange rate between the euro and the US
dollar; as well as 4) the risk factors specified on pages 10 to 16 of the Company's Form 20-F for the year ended December 31, 2000. |
