The Nokia contraction continues: 3,500 further job losses and more at the horizon

Next phase of changes to enhance efficiencies in manufacturing, Location & Commerce, and supporting functions

Nokia Corporation Stock exchange release September 29, 2011 at 10.00 (CET+1)
Espoo, Finland -

Nokia today announced plans to take additional actions to align its workforce and operations. The measures support both the execution of the corporate’s strategy and the savings target the company announced earlier this year, and likewise target to bring efficiencies and speed to the organization.

Earlier this year, Nokia announced changes primarily targeting aligning its R&D operations in Smart Devices and Cell phones. Today, the corporate announced the following phase of operational alignment, such as plans for reductions in manufacturing, the site & Commerce business, and supporting functions.

Nokia plans to regulate its manufacturing capacity and renew its manufacturing operations to higher serve its global network of consumers, partners and suppliers within the following manner:
- Focus its feature phone manufacturing on those locations with optimal proximity to suppliers and key markets. Consequently, Nokia plans to shut its manufacturing unit in Cluj, Romania by the tip of 2011, as Nokia’s high-volume Asian factories provide greater scale and proximity benefits.

- Review the long-term role of its manufacturing operations in Salo, Finland, Komarom, Hungary, and Reynosa, Mexico. These factories are expected to continue to play a key role in serving European and North American smartphone customers, however the plan is to gradually shift their focus to customer and market-specific software and sales package customization. It’s miles estimated this is able to influence the collection of personnel in 2012, with out a impact in 2011. Nokia will engage in discussions with employee representatives and stakeholders in these sites, and expects to have more visibility into the prospective headcount impacts within the first quarter of 2012.

Nokia previously announced its plans to create a Location & Commerce business consolidating location assets including NAVTEQ and Nokia’s social location services operations. As portion of consolidating this business, Nokia has identified potential synergies and opportunities to extend effectiveness through automation. Location & Commerce is answerable for driving the delivery of the world’s best digital mapping content, location platform and social-location experiences. Nokia plans to pay attention its Location & Commerce development efforts in Berlin, Boston, Chicago and other supporting sites, and plans to shut its operations in Bonn, Germany and Malvern, US.

Nokia can also be starting consultations with employees in Sales, Marketing and company Functions, in accordance with Nokia’s earlier announcement on April 27, 2011.
“We’re seeing solid progress against our strategy, and with these planned changes we can end up a more dynamic, nimble and efficient challenger,” said Stephen Elop, Nokia President and CEO. “We must take painful, yet necessary, steps to align our workforce and operations with our path forward.”

“Europe is core to Nokia’s future. As well as our headquarters, we now have a robust R&D presence in Europe. We now have four major R&D sites in Finland and two major R&D sites in Germany, in addition to Nokia Research Centers and other supporting R&D sites in Europe. Nokia also retains a powerful local presence in our many sales offices throughout this region, in addition to our operations in Salo and Komarom,” said Elop.

The planned closure of the Cluj factory combined with adjustments to provide chain operations is estimated to affect approximately 2,200 employees. The planned changes inside the Location & Commerce business are estimated to affect approximately 1,300 employees. These personnel reductions are as well as the measures announced in April and are expected to take effect by the top of 2012.

Consistent with the corporate values, Nokia will offer employees suffering from the planned reductions a comprehensive support program. Nokia remains committed to supporting its employees and the local communities through this tough change.

About Nokia Nokia is committed to connecting people to what matters to them by combining advanced mobile technology with personalized services. Greater than 1.3 billion people connect with each other with a Nokia, from our most affordable voice-optimized cell phones to advanced Internet-connected smartphones sold in virtually every market on earth. Through our services, people also enjoy access to maps and navigation on mobile, a rapidly expanding applications store, a growing catalog of digital music, and more. Nokia’s NAVTEQ is a pace-setter in comprehensive digital mapping and navigation services, and Nokia Siemens Networks is among the leading providers of telecommunications infrastructure hardware, software and professional services globally.

FORWARD-LOOKING STATEMENTS It’s going to be noted that certain statements herein which aren’t historical facts are forward-looking statements, including, without limitation, those regarding: A) the anticipated plans and benefits of our strategic partnership with Microsoft to mix complementary assets and expertise to form a world mobile ecosystem and to adopt Windows Phone as our primary smartphone platform; B) the timing and expected benefits of our new strategy, including expected operational and fiscal benefits and targets in addition to changes in leadership and operational structure; C) the timing of the deliveries of our services and products; D) our ability to innovate, develop, execute and commercialize new technologies, services and products; E) expectations regarding market developments and structural changes; F) expectations and targets regarding our industry volumes, market share, prices, net sales and margins of goods and services; G) expectations and targets regarding our operational priorities and result of operations; H) expectations and targets regarding collaboration and partnering arrangements; I) the end result of pending and threatened litigation; J) expectations in regards to the successful completion of acquisitions or restructurings on a timely basis and our ability to accomplish the financial and operational targets set in reference to one of these acquisition or restructuring; and K) statements preceded by “believe,” “expect,” “anticipate,” “foresee,” “target,” “estimate,” “designed,” “plans,” “will” or similar expressions. These statements are in line with management’s best assumptions and ideology in light of the knowledge currently available to it. Because they involve risks and uncertainties, actual results may differ materially from the effects that we currently expect. Factors which could cause these differences include, but aren’t limited to: 1) our ability to reach making a competitive smartphone platform for prime-quality differentiated winning smartphones or in creating new sources of revenue through our partnership with Microsoft; 2) the predicted timing of the planned transition to Windows Phone as our primary smartphone platform and the introduction of mobile products in response to that platform; 3) our ability to keep the viability of our current Symbian smartphone platform in the course of the transition to Windows Phone as our primary smartphone platform; 4) our ability to comprehend a return on our investment in MeeGo and next generation devices, platforms and user experiences; 5) our ability to construct a competitive and profitable global ecosystem of sufficient scale, attractiveness and usability to all participants and to bring winning smartphones to the market in a timely manner; 6) our ability to provide cell phones in a timely and price efficient manner with differentiated hardware, localized services and applications; 7) our ability to extend our speed of innovation, product development and execution to bring new competitive smartphones and cellphones to the market in a timely manner; our ability to retain, motivate, develop and recruit appropriately skilled employees; 9) our ability to implement our strategies, particularly our new mobile product strategy; 10) the intensity of competition within the various markets where we do business and our ability to keep up or improve our market position or respond successfully to changes within the competitive environment; 11) our ability to keep up and leverage our traditional strengths within the mobile product market if we’re unable to retain the loyalty of our mobile operator and distributor customers and consumers as a result of implementation of our new strategy or other factors; 12) our success in collaboration and partnering arrangements with third parties, including Microsoft; 13) the success, financial condition and function of our suppliers, collaboration partners and customers; 14) our ability to source sufficient quantities of fully functional quality components, subassemblies and software on a timely basis without interruption and on favorable terms, including the disruption of production and/or deliveries from any of our suppliers because of the adverse conditions within the geographic areas where they’re located; 15) our ability to control efficiently our manufacturing, service creation, delivery and logistics without interruption; 16) our ability to verify the timely delivery of sufficient volumes of goods that meet our and our customers’ and consumers’ requirements and manage our inventory and timely adapt our supply to fulfill changing demands for our products; 17) any actual or perhaps alleged defects or other quality, security and safety issues in our products; 18) any actual or alleged loss, improper disclosure or leakage of any personal or consumer data collected or made available to us or stored in or through our products; 19) our ability to successfully manage costs, including our ability to attain targeted costs reductions and to effectively and timely execute related restructuring measures, including personnel reductions; 20) our ability to effectively and smoothly implement the recent operational structure for our businesses; 21) the construction of the mobile and glued communications industry and general economic conditions globally and regionally; 22) exchange rate fluctuations, including, specifically, fluctuations between the euro, that is our reporting currency, and the usa dollar, the Japanese yen and the Chinese yuan, in addition to certain other currencies; 23) our ability to give protection to the technologies, which we or others develop or that we license, from claims that we have got infringed third parties’ intellectual property rights, in addition to our unrestricted use on commercially acceptable terms of certain technologies in our services and products; 24) our ability to give protection to numerous Nokia, NAVTEQ and Nokia Siemens Networks patented, standardized or proprietary technologies from third-party infringement or actions to invalidate the intellectual property rights of those technologies; 25) the impact of changes in government policies, trade policies, laws or regulations and economic or political turmoil in countries where our assets can be found and we do business; 26) any disruption to information technology systems and networks that our operations rely upon; 27) unfavorable outcome of litigations; 28) allegations of possible health risks from electromagnetic fields generated by base stations and mobile products and lawsuits concerning them, in spite of merit; 29) our ability to reach targeted costs reductions and increase profitability in Nokia Siemens Networks and to effectively and timely execute related restructuring measures; 30) Nokia Siemens Networks’ ability to preserve or improve its market position or respond successfully to changes inside the competitive environment; 31) Nokia Siemens Networks’ liquidity and its ability to satisfy its working capital requirements; 32) whether Nokia Siemens Networks is ready to successfully integrate the acquired assets of Motorola Solutions’ networks business, retain existing customers of the acquired business, cross-sell Nokia Siemens Networks’ services and products to customers of the acquired business and otherwise realize the predicted synergies and benefits of the purchase; 33) Nokia Siemens Networks’ ability to timely introduce new products, services, upgrades and technologies; 34) Nokia Siemens Networks’ success within the telecommunications infrastructure services market and Nokia Siemens Networks’ ability to effectively and profitably adapt its business and operations in a timely manner to the increasingly diverse service needs of its customers; 35) developments under large, multi-year contracts or with regards to major customers within the networks infrastructure and related services business; 36) the management of our customer financing exposure, particularly within the networks infrastructure and related services business; 37) whether ongoing or any additional governmental investigations into alleged violations of law by some former employees of Siemens AG may involve and affect the carrier-related assets and employees transferred by Siemens AG to Nokia Siemens Networks; 38) any impairment of Nokia Siemens Networks customer relationships as a result of ongoing or any additional governmental investigations involving the Siemens carrier-related operations transferred to Nokia Siemens Networks; in addition the chance factors specified on pages 12-39 of Nokia’s annual report Form 20-F for the year ended December 31, 2010 under Item 3D. “Risk Factors.” Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect may cause actual results to vary materially from those within the forward-looking statements. Nokia doesn’t undertake any obligation to publicly update or revise forward-looking statements, whether because of new information, future events or otherwise, except to the level legally required.