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Technology Stocks : Nokia Corp. (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: Eric L who wrote (2846)	5/20/2003 9:56:53 PM
From: Eric L	Read Replies (1) \| Respond to of 9255

Japanese Handset Makers Unit Sales in 2002 >> Japanese Handset Makers Mobile Communications International Issue 100 01 May 2003 Contrary to the hopes and fears of many in the mobile handset industry, Japanese manufacturers are not poised to reap the global rewards of their technology edge in digital media, software and applications, say equity research analysts at Morgan Stanley. They believe that, "Japanese handset makers are unlikely to gain market share in 2003-04," with the market share remaining stable at 16 per cent. The problems for Japanese vendors, says Morgan Stanley, include lack of scale in export markets, lack of cost competitiveness, and too much focus on the proprietary domestic PDC standard which diverts valuable R&D resources. The technology gap between Japan and other countries is also narrowing, particularly as 3G, expected to provide a boost to Japanese vendors, has been very slow to launch outside Japan. On the positive side, statistics suggest an upturn in domestic sales as camera phones and 3G phones are driving the replacement market and exports have been brisker in the last year. However, views on the Japanese market are diverse, and Gartner recently announced that 2002 handset sales had dropped by three per cent in the second straight year of decline, replacement sales proving unable to offset falling numbers of new subscriptions. Japanese Handset Manufacturers: Unit Forecast Shipments (mln) 2002A 2003E 2004E Panasonic 13.5 15.2 14.7 Kyocera 11.6 12.6 13.5 Mitsubishi 10.5 11.0 11.5 NEC 9.5 10.3 11.1 Sanyo* 8.4 10.0 NA Toshiba 7.5 6.6 6.9 Sharp 5.5 5.9 NA Total 66.5 71.6 74.2 Global Share 16.0% 16.2% 16.5% * Company's own guidance. E=Morgan Stanley Research Estimates. Source: Company Data, Morgan Stanley Research - Eric -

To: Eric L who wrote (2846)	7/28/2003 3:34:39 PM
From: Eric L	Read Replies (3) \| Respond to of 9255

Q1 & Q2 2003 Handsets & Historical Handset ASP, Margin, Cost The usual disclaimer applies here: I could have made miscalculations or typos. A. 2003 Handset "Sales" Reported Q2 2003 Handset "Sales" · $ Sales Unit Market Market Nokia v. (Bil USD) Sales Sh @ 105m Sh @ 112m Competitor · Nokia $6.3b 41.0m 9.0% 36.6% - Motorola $2.3b 15.8m 15.0% 14.1% 2.6x Samsung $2.7b 12.0m 11.4% 10.7% 3.4x Siemens $1.0b 8.1m 7.7% 7.2% 5.1x Sony Ericsson $1.3b 6.7m 6.4% 6.0% 6.1x LGE $.87b 5.3m 5.0% 4.7% 7.7x Note: Nokia reports "sell-thru" while most others report "sell-in." Like Ericsson, Nokia sees handsets shipments (to end users) at 105 million Q2, up 5 million from Q1 (their original view of Q1 was 98 million). Gartner Dataquest had Q1 pegged at 112.7 million units sell-thru, and I am assuming they will tally sell-thru at 110 million to 115 million units Q2. Assuming industry consensus sell-thru of 225 million units H1 03, Nokia's market share will be 35.8% CYTD, and they could (should) exceed 36% market share this year, regardless of whose numbers their unit shipments are measured against, while they increase their market share for (at least) the 8th consecutive year. Worldwide Terminal Sales Estimates For H1 2003 · Company 1Q 03* 1Q 03 2Q 03** 2Q 03 H1 03 H1 03 Units MktSh Units MktSh Units MktSh · Nokia 39.5m 35.0% 41.0m 36.6% 80.5m 35.8% Motorola 16.6m 14.7% 15.8m 14.1% 32.4m 14.4% Samsung 11.9m 10.5% 12.0m 10.7% 23.9m 10.6% Siemens 8.6m 7.6% 8.1m 7.2% 16.7m 7.4% Sony Ericsson 5.4m 4.8% 6.7m 6.0% 12.1m 5.4% LGE 5.1m 4.5% 5.3m 4.7% 10.4m 4.6% Panasonic 3.8m 3.4% NR NR NA NA NEC 2.9m 2.6% NR NR NA NA Others 18.9m 16.9% 23.4m 20.7% 49.0m 21.8% ====== ====== Total Market 112.7m 100.0% 112.3m 100% 225.0m 100% * 1Q 03 unit shipments estimates are sell-thru as calculated by Gartner Dataquest and include iDEN shipments, but exclude mobile WLL and ODM to original equipment manufacturer (OEM) shipments. 2Q 03 unit shipments are sell-thru or sell-in as provided by the manufacturers and include iDEN shipments, mobile WLL, and ODM to original equipment manufacturer (OEM) shipments. Market share assumes 112.3m units sell-in/sell-thru for Q2 2003. Note: Samsung reported 13.2 million units sell-in Q1 and Gartner reports 11.9m sell-thru excluding sales to ODMs for Q1. Probably we'll see similar adjustment from Gartner for Q2. LGE reported 5.6 million units sell-in Q1 and Gartner reports 5.1mm sell-thru excluding sales to ODMs for Q1. Probably we'll see similar adjustment from Gartner for Q2. B. Comparative ASP, Margin, and Cost U.S. S.Korean Operating Average Average Euro (USD) Won (KRW) Margin Cost USD Cost € · Nokia €134.50 $153.87 183,534 23.1% $118.32 €103.43 Motorola €129.44 $148.00 176,534 3.3% $143.12 €129.44 Samsung €170.96 $195.47 233,000 20.0% $156.38 €136.77 Siemens €109.32 $125.00 149,174 0.2% $124.25 €108.23 SEricsson €167.91 $192.09 229,124 (4.5%) $200.73 €175.47 LGE €142.45 $162.88 194,150 2.1% $159.46 €139.46 C. Historical ASP, Margin, Cost Q1 2002 ASP and Margins for the Big Five** · Manufacturer Av Price(€) Margin Av Cost(€) · Nokia 165 22% 128.70 Motorola 180 0% 180.00 Samsung 230 27% 167.90 Siemens 140 1% 138.60 Sony Ericsson 193 0% 193.00 Above Calculated by DirtyDingus on TMF · My rough cut for Q1 03: · Q1 2003 ASP and Margins for the Big Three and LGE · ASP Margin Av Cost(€) Av Cost (USD) · Nokia $158 USD 23.5% €111.97 $120.87 Motorola $147 USD 4.4% €130.18 $140.53 Samsung ~$197 USD >21.0% €144.17 $155.63 LGE ~$157 USD ~5.7% €137.15 $148.05 D. Source Material (selected) for Handsets Q2 2003: Currency Conversion Converted at the average Interbank conversion rate in effect on June 30, 2003. Historical ASPs were calculated at the average Interbank conversion rate in effect on March 31, 2003, and March 31 2002. oanda.com EUR to USD 1.1440 USD to EUR 0.87460 EUR to KRW 1364.560 KRW to EUR 0.00073370 USD to KRW 1192.80 KRW to USD 0.00083890 Nokia: Merrill Lynch: Nokia operating margin was down 70bp sequentially to 23.1%, despite higher volumes. Lehman Brothers: Mobile Phone revenues came in at EUR 5.5 billion ($6.292 billion USD). Handset ASPs in the quarter were €134.5 vs €145 in Q1. Nokia shipped 41 million units. Nokia highlighted share gains in the quarter both YoY and QoQ helped by gains largely in the US and incremental traction with CDMA in India and the Americas. Nokia believes it gained share in 2Q with unit volumes up 14% YoY within the context of a broader market environment of +11% YoY growth to 105 million units (sell-thru). Phone margins in 2Q were lower at 23.1% Nokia Q2 earnings statement: media.corporate-ir.net Motorola Merrill Lynch: MOT’s margins were 3.3%, down from 4.4% Lehman Brothers: PCS revenues and operating margins were broadly in line with revised expectations at $2.3 billion (-5% QoQ, -13% YoY) and 3.3% respectively, helped by slightly higher unit sales (15.8M) and stronger than anticipated ASPs which trended flattish QoQ at $148. ASPs trended flattish QoQ at $148. Motorola Q2 earnings statement: media.corporate-ir.net Samsung: Korea Herald: Samsung's telecommunications division posted 3.18 trillion won ($2,702 Billion USD) in sales and 550 billion won ($467 Billion USD) in operating profit in the April to June period. <snip> In terms of operating profit margin, the telecom unit towered over other units with a 17 percent margin, followed by the semiconductor unit with 15 percent. The telecommunications network group had operating income of $467 million on revenue of $2.7 billion ($2.3 million USD). Reuters: Analysts estimated the average selling price stood at 233,000 won ($198 on 7/21 or 195.47 on 6/30). ML: Samsung’s margins slightly declined from 20.5% in Q1 to around 20%. Samsung Slides: $2,702 Billion USD) in sales (including $2.3 million network gear) samsung.com Siemens Yahoo: Siemens wireless division reported a group profit of US$60 million in the second quarter. Its sales dropped 15 percent to US$2.5 billion as against US$2.9 billion in the year-ago period. On sales of 8 million handsets, the company raked in US$1 billion and generated US$2.2 million in profit. biz.yahoo.com Sony Ericsson Reuters: The joint venture between Ericsson and Sony, reported second quarter pre-tax losses of 45 million euros ($50.76 million), adjusted for restructuring costs. Sales were 1.125 billion euros in the second quarter as handset shipments rose to 6.7 million units from 5.0 million a year earlier. LGE Company Slides: Handset Sales = 1,029 W billion on sold 5.3 million units, with operating profit of 21 W billion (2.1%) lge.com ### More on Q1 Handset Sales here: Message 18992406 2001 & @002 (and prior) handset sales here: Message 18708054 Best to all, - Eric -