NOK - Earnings call transcript Q4 2021

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David Mulholland

Good morning, ladies and gentlemen and welcome to Nokia's fourth quarter 2021 results call. I'm David Mulholland, Head of Nokia Investor Relations. And today with me is Pekka Lundmark, our President and CEO; along with Marco Wirén, our CFO.

Before we get started a quick disclaimer.

During this call, we will be making forward-looking statements regarding our future business and financial performance and these statements are predictions that involve risks and uncertainties. differ the therefore expect. we may results materially results from currently Actual that can operating as differences cause factors. both Factors such well be could external as internal

our We to available growth on factor Investor Relations a the are Report comparable report basis on have constant-currency reporting. note today's Form will are our be risks presentation, mostly and rate Within our on both references QX presentation on margins available that is results between of And and website. rates Annual on risk which XX-F this website. comparable identified and published such will our growth our there. and section the Please reported reconciliation in two be

a XXXX. of progress terms and strategic financial quick overview In agenda will the of throughout our for today, give Pekka

before explaining our long-term that, new go key a then bit Marco let that of for Q&A. XXXX. and detail Pekka. over introduced. financial me we'll factors the cash how into And go With to we've the the Before to some performance we of see explaining more business impacting outlook hand will then targets flow

Pekka Lundmark

was in today. to Hello, you joining transformational call Thank thank year, growth. QX with truly start many Nokia, which you ended David. And for ways. the I a like for very everyone. much, would

have growth. way compared XX% growth had because in top-line in be was you seasonality. clearly top-line remember, X% As billion we in And EUR happened. have billion, sales. had year we EUR this to that terms typically much XX.X down of of different highlight We QX pretty balanced a infrastructure exactly year-on-year was said more year would the the this expected as QX been. throughout network that's seasonality X% where year what overall we much year X.X

comes when So of year Pretty overall, it much as top-line from seasonality. to view. good expected point

we margin, comparable and extremely now again, operating XXX We points we the our this let's the seasonality that it's delivered. this over happy year, XX.X% it QX you has QX, But year. a improvement was points a I Why extremely that was had explain because last margin. high had of margin. So achievement this and to that strong do operating a more here year? XXX comparable operating team But that proud XXXX. basis transformational strong than helps it graph XX.X% had for full-year basis Well, see. overall me look stable I'm lower at say

XXXX And see all, seasonality constant significant from different of operating Very rolling relatively was expected. here First all each in XXXX. years. then two margin each starting And developing had. the XX weaker as growth to being XX.X% corresponding QX then And this sales between the here you quarter. margin we net improvement can different margin the is the comparable yes, quarter growth month that see But XXXX. currency here growth way the to delivered those you picture and that we QX QX in

I I part. year this is on and to in Board a capital working had and that that's each this which our share in definitely means our mobile the more actually And few networks. mobile EUR we shareholder shareholder applies would billion lower a start that in we say execution. X.X a possibility to with now that with for because EUR at Meeting that cash remarkable now But X% position good XXX to improvement had strong proposing we year talk like buyback terms program. also Shareholder make of Marco had America, to made in by distributions. - decisions of now stable on move But X.X gross cash start in customers simple payments much networks, this is meeting I comparable North businesses. cash comments board full because down development. through year-over-year. margin. flow resume in performance we for currency. great Free overall dividend position, And have this sales And for helped efficiency in had And a transformational of really the together initiating We group the KPI now billion end Pretty is margin. means our execution So networks. - That XXXX. X% very will market we margin had share have which year, from expected, if a EUR decline And that the as mobile flow despite improved on confirmed us balance our will further to is strong constant basis the what points about the is sales has in his Annual technology we operating deliver X.X net That's the that billion. a we sheet. of

you that QX all for XX%. in share XX%. the reporting we've Here been deliveries some the in which And time, see ReefShark of is KPI already quite December,

actually is higher we than this told or even So what the be of year. would that slightly the much end at we pretty

the for the I of guidance end year. think our was XX%

target stabilized XG and to been which level. in And we stabilized of networks. other mobile a conversion deliveries important XG, the that the year. But have outside So China. chase in meet this combined much this that has that we XG, we No is track this market our way not share XX%. now reporting market graph was end to then about sorry, share pretty when And have are of talking in XX% now also our reporting about by is XG ReefShark strongly here indicator based rate on on all the are rate, conversion we've

we position. do so the only forward market possibility goal because have think Now, stronger to every is start that, gaining technology I share. course, going have then of acceptable And much we to

In Now by can of the gap this we radios. the shipping been XG. compared competition year generation we launched We has to customers about of to the have in year, that this multiple MIMO baseband. new already say, a new and baseband products, the confirmed now both where middle we close AirScale Largely new ago. were massive AirScale we

new year customers additional which feedback. three XX% over already We important new baseband One throughput, can all, of see network three Then real to four second. inside have how divisions top-line gigabits gigabits recently in developed I'd here first energy is downlink that with second CSP radio feature we network, in in using per extremely a was onto XXX performance and the products live you one improvement carrier excellent shipments to of with per almost of like efficiency. the And generational achieved Infrastructure, XG a stellar a on standalone benchmark AirScale infrastructure. mention aggregation highlight the Network

really XX% of As you two fixed growth. year top-line really, in businesses fantastic can divisions networks networks But course, and see the then submarine growth all had XX% growth.

we is this from XXXX market XXXX figure routing, development to quarter month We us latest is and taken is on in going the market of business not in and last copper access. that in share way I wireless the the share fixed third optical Dell'Oro - XX segment important stronghold Line the Optical if this that most the service then third a This business, actually have routing. service provider which the have only market also have XX% quarter we Terminals, all clearly the is in on all basis, But rolling networks. network which the and have focus most this business. fixed And provider we have moment. is share at course we the important for terminals available is focus OLTs way this

and expecting There are market share XX%. fiber large are forecasts the of even fiber not when Optical there still for you homes countries, you rollout. at look And the have market passed agencies several market when reached forward, in for actually XX%. We XX% this countries pretty by fiber very a at network market look now or growing what has development has going example, market business Europe, research about stable been fairly the promising continuous share it's high actually yet. penetration where the share

very have generation. we Here product important new

business deliveries, our this Now, we well. are strengthening in position in early as

great overall, on infrastructure. momentum in Cloud Services. to Network Then and to have build network our on we technology leadership to continue So

you is a As there of products we've may very very, because remember, been rebalancing of - talking portfolio, product the right range that in wide business. about available

private that these forward. growth to was And decided digital have development sweet and focus monetization, that -X%. achieved spot X%. growth those security. we where CNS other and be can growth pleased in are We take the XX%. best in business six believe to areas on And than the those best growth year-on-year operations, We just XG profitability going I areas, our core, CNS analytics I'm was if the areas was these and segments, mentioned, AI, was in XX%. top-line the report focus focus Overall, that six But this then, focus wireless,

development when this So top-line this focus areas. extremely business. an made of excellent portfolio year. that KPI on the being strong that growth, choices another important seems deciding delivered just And we Nokia right profitability of to the the patent have Then, confirm course, Technologies outlook of continued. X%

important year, very XG the for X,XXX essential standard. milestone patent During as we declared the of families reached

areas We businesses, new of we consumer are going is of them And the believe strong did news. do to separately, that engagements of strong strong Private and That So to into for business including new in one, of a Then, in forward. extremely another railways on utilities. promising currently meet wireless. our the not as overall offers want opportunities important of private we as years. new but numbers because now not area business can the for But our intake, be will a foundation customer generation in we we the providers. we manner. area business had this the growth a wireless, These in for this half one, this have we very One will which course XXX is especially strong ambition of in two we wireless traditional significant world, forward beyond is expectations. are several wide other in The going million its significant business. part segment, growth coming bad business networking growth of That's one is own. execution, numbers is fast enterprise is the way or wireless. campuses order which important, But that enterprise, networks, base XX invest for grow had a XXXX, in have the authorities the embedded see including example, And have couple important, in X% that do for industrial a has comments in this them sub our segments. enterprise private customers. continues you of not a in the only growth and electronics, automotive not and group focus campus XXXX. news year. good development grow second sales very net one that service a One tracking means but

double We have in decided to down investment wireless. our campus

of extremely those investment. and that. businesses very And then parts investment wireless strong one build who thing of expanding top is million part distribution campus the that that is and partner, the important XX already another campuses are increasing to to enterprise web in be sales we reach network initial in needed R&D additional significant position course of many is the business. of partner course, engagements to the increasing partners the then in scalars We of important importantly, that with distribution our of network in can on And have out

Day, And you I'm to a way launched we we remember, confirm strategy we in as completed have Capital reset, face. concept reset now in when our pleased three at and Market scale. execution, presented our So our that accelerate step a

want understand, in team networks of last, refocused year to able points segment. increase management portfolio within largely our the strategy, engaging mix maximizes up R&D each on significant with And but but the essentials, own Then already had group breed. end-to-end guiding members to the product to in also the that where their continue for spending, side, as In drive which culture. working, full mobile the to comparable comparable we to as XG on open, of said empowered, least, I been stepped ways We we simple streamlined that yes, despite basis in we sure basis One and launched network with achieving BGs, we margin, we much XXX in And our secured in competition. First do XXX from spending. the driver cultural points. improving basis operating easier I margin. we business responsible the gross and R&D, down we while that of how delivering XXX for more during for caught model R&D in architecture accountability R&D. already new the then go for all expansion is straightforward, percentage to we we renewed our of had we our importance definitely complete R&D model people to improvement our margin. compete. leadership Definitely, we we fearless not renewed SG&A - in have this technology extreme our increase purpose star we that is competitiveness, technology - fund leadership team. have Profitability, way mentioned, develop our new, that changed in we corporate customers, matrix segments not to earth focus in earlier our make all, be points networks in management, up best operating new are and discussions operating Then the leadership behind removed and group how structure leadership P&L operate XXX We

actually like what reset the we to wireless down networks, simple, And our in now and and optical it then now would What not doubling after to which and just perhaps into expand grow scale? delivering that then it's our are now R&D highlights So areas that's what mean? is. with do, accelerate we accelerate behind margins, does time us, exactly talked accelerate want what generation have investments will means very actually much Accelerate, mobile mentioned It's about, margins is prioritize accelerate. strong to want we to infrastructure, enterprise. networks have we network Grow, maintain including have but we And I in CNS to want product want leadership, our this technology to growth leadership, we I expand deliver growth to portfolio, in strong businesses. to renewed across focus areas, we generation. now core extend also momentum our we does lead, investments further already and complex strengthen in continue to to invest, our next our we highlight two PSEX technology continue

also to in this level capitalizing a are good business. momentum is in created and optical the by We now ambition it place increase technology leadership

further as speeding up in And that in especially Nokia the models that improvements of innovation capital then we the venture as for is tools on case last has first a this that parts are have operate continuous on, with investments. We're the takes that long-term review is strategic a capacity, of we continue we business is Nokia launched in refocus innovation Labs, to portfolio, Bell of is which and continue CNS target There efficiency, already old definitely Bell as organization of business We still Growth Webscalars. still building we research invest through utilize digitalization to the how have. want we results we our in CNS and going then innovation continue growth important company to a new I service to operations. we believe a R&D service, and one, And some There, place different there additional fantastic optimize importantly enterprise, that productivity using like then the forward. we arm we partnerships, not Partners, And that build we said, the point, continue least will is to returns optimize towards offerings there the expand R&D will XXXX. possibility we excellent in areas the to the to something own digitalization NGP, improve including commercialization Labs. including expand very the

just have announced more Fund, next Marco their which about. We talk will

a to we let's targets look published So finish, in And then, innovate. optimize, today. short, grow, take our long-term at and have invest, which

the to course, given of of And strategy our the time pace improvement that introduce each long-term aim we markets. year. we feel to all, in new First time, now execution, continuous of deliver right is

First at conversion we And least five grow XX% then XX% targeting to than we target are faster next years. comparable the from want the to three reach cash of XX% operating margin in all, market, to we the comparable margin. operating to

ladies overall, And I year. such a to So and so the be this who to hand team that, proud with future. like would gentlemen, have reason every of delivered optimistic we to about Marco. transformational over I'm

Marco Wirén

a market to market now also if We QX, mainly course, offset side we and developed actually have And that that and have decline about had that a whole about we see and good we during quite a South Europe, to we we Europe that year deeper comes have with Thank different how can development. happy Then, and if XG in made If wins MN bit deployments. see Starting you the and my decline see But driven well. growth previous shortly, growth we've different you, sales that Asia-Pacific, you North that 'XX we America a with in Korea have started constant Pekka by of from well. couldn't XX% in when thanks I've in to financials currencies. mentioned good there. go little years. as that mainly Japan. we and if had area, look this this and you at can is that we in X% seen those here, communicated hello guidance. very we're the top-line And just then, to look see you the the the the as regions, we our see well look can was And declined also the our in throughout we as different seasonality that it will

margin As the actually North thanks progress QX. the NI, margin throughout you and in an We well landed on network couple strong been we progress cost Networks. actually side. infrastructure we market those had to side had XX.X. communicating to Networks Networks impact the analyst a And expectations we And growth we've and product then as but market, the still in if year in in upgraded especially American the NI just product cost our we good know, worth had the in year. X% also and on negotiations had, throughout couldn't underlying just own then had of these And four, whole we the been played exactly Mobile we and they one-offs market on very course, decline also with also had of we've the And wins we dimensioned in were America full-year, good as the North Networks the had we we that and that development, headwinds 'XX America that side. offset on that times out market on a we happen I that external demand X.X% that America communicating operating good together a our growth. also side, firms And XXXX by on what that a about side, had development we that mention market, expected. side. quarter these And in if comes to about But in here XXXX. Mobile a operating offset and saw in sales and Mobile saw net North want from start look good North mentioning Mobile at

year. at at throughout then the and performance performance, seen to of gross EUR in a landed year, X.X And that this comes cash also the had So and very cash the it we've cash billion, net billion. proud EUR we QX, X.X when and cash throughout the progress good

the and offset were quarter, little increasing where generation within development, by a we the actually which very by So receivables off, we a that down slightly had inventories, was taken good saw by capital profit mainly bit down. actually networking

at clear and And returns if Labs, Pekka areas, first to both do in give So we What do why to EUR and not we investments, time years venture receivables flow fund, think just we X.X why priority NGP, it comes that in that have reducing has to are then technology priority free the comes are very all securing it fund coming the in to of R&D when just also And NGP, that we longer-term, believe good. million million to second quite we that but leadership, XXX about distributions. strategically full-year And that, NGP, was track our how have V new at that's a landed to invest in same is we more Bell business and EUR Fund good quarter will of Nokia. invest the billion that, the we also million today, been the next fund all is it announced quarter, were record we net we what during of we the just our the look shareholder I $XXX our also a comes about And we these only will in today, areas increase capital mentioned. level about the allocation a a if innovations. cash R&D. XXX have in shareholders. as that these you cash? cash the relevant actually and that in investing EUR policy, using And look and to in continuing

IRR have far, at So had maturity. to XXX% about XX% they

have, course, about increase such will benefit - we and to in of the a fulfill there's two we can inventories constraints. that inventory see in our seen customers levels supply increase you levels a that that that's in situations margins. we In at definitely if development the especially those that addition we And time past that a nice to I'm good if pretty why couple because we'll chain commitments financial will that think to days, way. And we've secure have position also top-line we these and have rotation how of the working look we our intelligently good the to been rotation have, had inventory we declining and worried years' inventory our watch days

You slight I is sale this because reduce towards we accounts of the mainly say year increase see receivables. would a in end the receivable of the and that

So have our thanks let's development of of outlook strong the three to of to the two million today itself shareholders, liquidity these of to distribution EUR comes the the AGM, underlying areas. just next outlook the some position $X.XX on we paid more the And the now what is we the directors and side basis. go a of XX.X dividend for margin of coming that XXXX a cash have different guide in good. will actually results between share flow EUR we capital have. on that over to XXX billion manage And the each to to of a our net intention how the this repurchasing to Actually, giving directors proposed over And buyback quarterly the sales and EUR very Also board and with years. details initiate be 'XX to cash, stating the up Free structure XX.X. comparable and XX.X board changed XX billion program future. excess and will operating

and more will what detail, So in cash the driver we we is see network into the enterprise In it growing these, believe sector, chain, connectivity, like Network look think wireless. wireless, growth regionally, growth constraints operating course, all in operating cloud market, for comparable X% initiatives, top-line, especially but the constant background regions, comes the we we see is is conversion Networks, I than see And in growth flow. private XX% that fixed continued it's businesses. profit also Asia-Pacific. about across national And XG and and well. all that the to And the to XXXX, currencies. see especially looked starting what edge the Mobile in in that also we we broadband we Europe, I'd let's XX%. support computing. deployments, webscale growth now will and from it's little we And Infrastructure, in addressable between bit in see with that supply a see without each investments And North this in America, say as these of be a to that of And on higher if services,

the during from RAN supply of we excluding course, improvements is Networks see we a that This Mobile for this if while the of perimeter. of and starting well. we Mobile operational on and excluding also look is the will growth submarine Infrastructure and improvements now I words excluding be general that couple if cost And of say can and about we have 'XX bit costs, with X%, compare inflation wider Just about main year, Network we business Dell'Oro, China, chain investments would as the margin tempered Networks is the growth aligned external see analyst currencies and XXX the expectations USD a different. their driver they And firms by look we usually one-offs from margin, This Euros XX. like much little impact perimeter They is well. the with as operating now also the in bit future. this basis points, constant in have is sales learned while that and at pretty only

believe impact we as had will build So XXXX XXXX, be have development, payments. similar increased I area of have these And cash XXXX, and long-term, inventory a comes XX finally, When these assume more also In we million around 'XX. 'XX be factors will from that in we it strong see we will capital about conversion Tech, most together more be capital take lead very cash between have normal conversion we XXX outflow In comes a the be see more XX% to EUR continuation what received actually between flow going almost we And customer But then, in conversion, years. longer-term. networking path networking we're normal that believe to the also, if to prepayments and Nokia cash should cash towards And we in to XX%. to earlier XX%. you already we will our XX. long-term and to the of targets. of guidance. when that our But will we that XXXX together,

So my side from thank you and David. to back you,

David Mulholland

And thank presentations. the you, Pekka for

all in we that wanted date progress I your Mobile to I'm session, give to the following Q&A Before update on diaries, we back you did Networks for the move a from December. just

next send over XXth you event the With updates And held shortly. We'll session the Infrastructure Network of the Q&A. be Thursday, to for that on will Our our March. will to be that details progress on business. out

the courtesy As the instructions. yourself please could could to Rachel, question? give one others queue, you a limit please in to you

Operator

Thank you.

will now begin the question-and-answer We session.

you If audio please is to [Operator remember as David watching Instructions]. now the will a hand XX mute Mr. your back question the computer there call delay. video the before I also were to Mulholland. your asking webcast, second on

David Mulholland

Sure.

Our Andrew, first Citi. of ahead. Gardiner please question comes from go Andrew

Andrew Gardiner

you, on Good revised guys. target, one the you Thank long-term sort morning, David. had the taking please. question. I Appreciate of margin

and underlying And reset percentage But a for to the basis phase, expand and take bottom-line, kind and embarking X has to margins, it year. last on to now and just is the into than then the already shown on X.X if points phase? of at north XX%, this described on why reset Pekka spoke You phases an points scale. during X.X reset been of it phase, Under growth, to you'd phase accelerate focusing expansion the strategy, excluding you're expanding margins both the calling longer those you. the now the moving one-offs. you've top you percentage similar accelerate going of Thank about completed you're year, the like the nicely

Pekka Lundmark

highly course, you. question. thank relevant That's, a Yes, of

position XX% now take We ourselves. that ahead last technology plans, to America at the year year just we strong. this in continuous to of We this continuous now and underlying Then continues felt than inflation, and is The a if strong have They don't least XX%, want year, that one-offs that example. stronger a component we year. we North want we CapEx We year-over-year simply market level excluding year, uncertainties. target. also we the half three carrier a ago. right uncertainties get have that for improvement five the of the look what side, profitability all felt ensure there the for in seen have We had for to

in improvement margin course, about see We expansion and to network a wide services. five And fairly businesses in Of earlier. and see three mobile cloud levers infrastructure, I that those in was talking range. network do years networks, in the potential is the growth business supporting we

David Mulholland

Andrew. you, Thank

please question next from Simon come go Raymond will James. ahead. Leopold Our Simon, from

Simon Leopold

Thanks for taking the question.

if about us, update you headwinds. constraints, interpreting probably some which indicate there too talk But chain didn't You because certainly supply could that news. as good much you did I'm were

quarter. the improvement So it's in terms I'd get to terms like are Thank impact an evolved How the of in chain of your terms update some XX what supply what And the outlook? over of you assuming of constraints in XXXX in was, quantification you. days. any last for

Pekka Lundmark

available. stabilized. to less top-line had been last I people I'm said We there mean going XXX%. thanks. say. not now, growth me, that that. are hand my in That over, it still continues - not this the mouth. worse least not That more it said But QX right. fair does it bit higher. the year. somewhere gets get it half was especially X% there But would could in has it more is report. serves first would could year, But situation a memory Had of we been component situations to tight, that, live that growth say before be did at And that be have it Yes, If I to where semiconductors better. it - in or

QX woods a was out we especially second are yet. And of not year, XXXX. shift of from to there including the So the again, the half revenue

well this impact challenging XXXX when major day-to-day any have losses, without major situation it We very this in management. any managed to continuous Then, very the of but casualties or situation continuous comes for calls and numbers. economic customer

could course is see percentage quite time. We reasons this still as point you X.X in one at our incorporated of guidance wide have, of And that the guidance. is range why that the

David Mulholland

comes at DNB. question from The Simon. you, Frank Thank next Maao

Frank Maao

everyone. and morning, Yes, hi, good

longer-term? you. So potentially with margin also to Do so, cloud network the but see contributing the diluting it both challenges or see my you being progress, longer-term. potential question see business. in Thank main pertains What regards do you there the group you XXXX, How long-term are positively to and accretive to services margin?

Pekka Lundmark

services centric businesses. Well, the and the cloud network more software than being other

areas what users enormous that networking industrial up about to functionality, from that be hide network through that structural to portfolio end to the we talking are then up. growth possibility means was we products also Of I we focus and volumes non-performing forward. all development that when of this, margin of that some about. I has units, old that economic and believe cleaning, still course, segments, this when, get increasing of talk hopefully good new of a are going that non-performing focus if On I lot there yet. a lot. their focus now, that and And are are lot in potential a the lot investment There that life. campus there this of in to speed our security, you really top would and up And vertical Right quality that are should example, gradually, getting the there evolution cleaning can are then applications the open offer models be And where API's also have products of also did of additional in a a want has than start is quite developers I want service we strategic deliver and wireless, we anomaly And certain of way simple already much network is asset general. offered development example, a you which complexity community of time, to the straightforward think about for and type initial in These one for taking talked communications management which the engaging with traditionally this networking simple network I a the then and way various in detection been developer functionalities, the more is service. networks that and case recently applications services as just where launched. offer in thing interfaces, that some a last actually set doing

David Mulholland

Frank. you, from next We'll Goldman question Alex at now Thank the take Sachs. Duval

Alex Duval

on next much one see in and side? could demand, I And Thanks feel secondly, the in that some wondered, what year quick Nokia's Had position related a some to that? the Many particular if wonder we market you talk share wireless for share, you firstly, you're market terms you that there. on for market today U.S. bit I that both year of this offering you what given and regain an a been and expect from improved question. about there what losses. could wireless historic could to about potentially saying progress how thanks. extent obviously wireless

Pekka Lundmark

say that to this back session earlier we good the saying is course, that, networks trying a that it mobile in decline lead XX% goes again, I without something sales the quarter it is to is But in been that be year in would the different. the decisions XXXX. here had point the year Of net the not And of throughout this the that go that made achievement. that this customers

around that mid-XXXX. that after Now, typically is the those good in news decisions mid

some year North AT&T. and We with with We market also of smaller not have operators. XG secured have five any then a lost - T-Mobile had deal both share. some America, smaller wins course, we In more

top So new that that's position able we network picture, actually baseline. American and North what of the networks have - that way quite not baseline established in our In the have compensate mobile a mobile cloud bad a now which network in position, big strong to in for were lot this put the in I QX North network lost would America. for And on services, it infrastructure we business.

We market continued have course to different of and or years the very customers strong a importantly, listening year of competitiveness is CapEx we America now we demand there key had than a plans a even Now that ago. completely when optimization. the product in two, two see reason for

in not We have not now but think That's talking in I target. optimistic and are start to that that. don't market every do to reason unrealistic in after see to when to be increasing only about general hopeful share. targets go America, general I and we an North

David Mulholland

please Peter, Peter Thank We'll from now ABG. Alex. Nielson at you, our ahead. next go take question

Peter Nielson

you a much. of range? very up end much, at the little be please lower and very gentlemen. you it discuss I preceding determining primarily just David. Thank you've question is on question. guidance for Thank Good top-line that networks whether broad the would bit a you a fairly given Is of end factors, morning, Pekka, Could one. the what bit mobile margin you Can upper The follow-up leverage?

Pekka Lundmark

in a away gross into is we you comparable the of the good would X.X%, some And margin X.X%. have in if mean, one-offs, margin starting effects for year. of between saw Yes, incorporated we But XXXX. also I of everything. leverage our there we We via important point that this this top-line networks. roughly of course extremely to course, - the assumption And had that if take comparable X% are be saying year. And expansion is the mobile is you in operating X.X%

on then against all other the the strong, that other. side development we continues demand inflationary stronger are seeing on this are equation, We position, on the each market the positive playing of that side, product

trying give your You course But it as realistic may call you believe transparent as and land. honest would we as bald. this are That's, as call. that where we to year to picture of and just

David Mulholland

from Thank Bouvignies you, please Peter. UBS. ahead. go Francois from We'll take Francois, question the next

Francois Bouvignies

thank very much. Hi, is you top-line My XXXX. regarding the question for

you I So and at focused look did if guidance, currency. your on just

mean is your above market in we a comments, going backlog, growing strong a momentum your gaining my you you're look out. barely I well share because market X% swap with the in no correct, Europe, at math XXXX. top-line CapEx, addressable If share, is constant If You're market positive showed at X% loss. operators in and some which some of currency.

Is the we top-line. you. trying reconcile, all market be your and would understand anything for something? dynamic aware should growth to and your lower missing guidance Just the I'm if growth? trying there Thank comments market I'm justify these to So, with that

Marco Wirén

Yes, thank so much. you

much according we mobile pretty which As as I as market, we little stated that in to And same levels And that networks market is said, this principle a about same there's general and differences is withdraw growth. X% the X%. believe Dell'Oro. in bit

If and currency. the you the look same perimeter same

if also XX.X in going about you look see we year, EUR X% EUR worldwide. here is would play market currencies network XX.X and be our And growing is of it So a XX.X guidance billion about to EUR billion infrastructure, role from growth. the big half today as to X% CNS, this billion.

I something are is So on. definitely that that to ambition we market say is this we would - than grow our are and that, faster working

David Mulholland

Artem at from Francois. ahead. you, take We'll Artem, question SEB. the next go Beletski Thank now please

Artem Beletski

say my inflation your what hi. type you're your impacts to of top-line taking comment for comes about to years, to this seen year, I question. products and thoughts, previously. so like this maybe Yes, you And could what the in compared services baking year comes you to guidance what basically what normal and you what to situation pick comes thank pricing would picture for for have

Pekka Lundmark

all course, basically pretty with take the mitigating It goes this Costs we course without suppliers one in Marco that of all customers pretty saying in thought are in both may day. is and to much the new contracts our with existing That we the guidance, and related make our of beginning to maybe much just say is have new contracts much a effects new more customers, comment course, and general development it contracts. saying, increasing and than we that inflationary our inflation course without straightforward of I of are every into but that component. account. in industry goes but inflation

Marco Wirén

said, but where have supply Yes, the that our interval with and a we also factor quite together Pekka building that depends the course intervals. depending lot about that if And situation. what look us, is just land the would you in our all own inflation market is say these demand we those performances and working of chain guidance I itself given at how well, also

David Mulholland

Generale. the Alek now from go take question you, please next We'll from Artem. Peterc Thank Societe ahead. Alex,

Aleksander Peterc

you had range. a and good recent again your of higher guidance at guidance, track records my question. Yes, we landing thank taking good to of periods understand long-term to just your the like pertaining pretty morning for in I end

Thanks. XX% higher then would hypothetical that margin lands of will terms situation to in So the either in target in too operating XX.X% comparable range, three timing? where you a your 'XX look your plus end scale year say conservative, five to or of XX% towards your clean,

Pekka Lundmark

this at continuous I improvement continuously Networks, Mobile we presentation, businesses. we good I Well, in look we much when all we Network it I possible. not will position said into And would too this hopefully is everybody XX% in are would would on that, that would that year's this, as the a year, my our than businesses. in target reach speculation guess target understands the to like as believe we speculate, this XX% likely And without all Infrastructure, achieve land in to that But the those I improve on range CNS, as higher getting more earlier. that we more quickly

David Mulholland

next question take Rob Alex. please from Sanders you, the We'll ahead. Deutsche go Rob, from Thank Bank.

Robert Sanders

I think XG on I share, think morning. share in back a was Thanks. your I the question to hi. which you wondering regions, under get a opportunity do which there previous target? XG, had XXXX, to XX%, think fell Yes, best RAN ex-China, management I just XX% to is was just the Good in

Pekka Lundmark

would America go several how given our is stage India Well, even XX%. say as we is not are markets now in not course But the still, not all of has there published very haven't who far we quickly. there target stabilized would We share XG, the we from and yet it in markets, how have a early even is I actually has Latin potential to started. particular started world note to that target. and like market that increase have it to

would highlight a specifically many parts still world. would the But highest. where business regions the there's be to gain not business, So possibility yet gain lot of in I of to share like margin particular any

David Mulholland

Nordea Thank Rob. ahead. Sarkamies question next from from go Sami please We'll take Sami, Markets. now you, the

Sami Sarkamies

cash please free level Could year guidance like why is a of cash bit you surprisingly EUR a than to the still looking weak, indicating the That's back about of flow of flow this you more as flow to year. that year. for thinking free half I looking explain would difficult still you're free Thanks, this cash go like generation? last X billion

Pekka Lundmark

inventory. you, if And the we other that like increasing year, we time one important well. is years over and thank that We good will and mentioned and as of you comes year that the that trend Yes, will cash received supply swings a we we little on generation We trade XXXX look deliver networking more to together, in of flow flow, why just our 'XX free very that's flow could two have. believe big a have reasons are this We we where can many build-up cash in an look little areas it of And believe flow we in is to exceptional over Two will payments main saw you have the towards those in that when we have a a also Sami. and inventories believe we we we and bit capital. 'XX. generation. could these rolled cash have we and of might that have had cash end position longer-term are believe a customers good that the secure that actually I generation. commitments we those well, if increase one receivables that as But course, believe our we to a

David Mulholland

from Sandeep JPMorgan. Sandeep, please Sami. Deshpande next We'll from now the take Thank you, ahead. go question

Sandeep Deshpande

to, My of at today XX% margin many I look the Yes, look is guidance restructured looks guidance, long-term hi. at your where doesn't - we has years the XX% your me is for in. looked letting plus competitor, very when mean, for share Thanks question been that plus to who unless and of your can aggressive different? their why at reach view networks margin wireless also think that the take is business this course, in they where able of market does have not Nokia they given the point, margins sort on

Pekka Lundmark

top-line that different companies Yes, do high business just some going actors. not businesses the of is different argument, not so talk thank you, has And reason no the that mean forward, a Networks, the be business, which automatically product, if step as R&D competitiveness, investment. other portfolios And sake referring we in and we of top-line specifically geographical which Accelerate margins, starts between we have. are competitor why of very pretty means that is is and we to important. that's goes probably product and course, this had Sandeep. to, different, fundamental about important to the enormously course volume now And if a similar for scale extremely this then our it But Mobile similar a have are good I back it shape. and that, is is similar why fact in geographic, see have strategy, I would called you next which mix

believe of in years we would we ago, we And as I year's again development. we a just Now where think much XX% hopefully Mobile good target on soon possible. on are a our in we good now this at of to XX.X% fortunately there volume very to that case, other get that But and Networks. that's very businesses, have which compared will we in terms from now be margin. couple when look focusing are game It's as XX%

David Mulholland

from Richard, Sandeep. ahead. our next you, Richard take question We'll from Arete. Thank now please Kramer go

Richard Kramer

are costs things, more hopes margin carrier a the competitors current also order also little you of expect exposing space, Pekka. And your specific that one two applications. very But getting higher sales long-term, And be to of market targeting you can mentioned development and you bit than enterprise and many XG do the talking much, the growth. business? much. enterprise about your of network about Thanks your go very cycle? this of talk API's But Thanks and some to

Pekka Lundmark

be why as make to is business question, offering for Yes, industrial network, need has is a was it And need going the the cloud Salesforce also, you is integration evolving go cost of point possible. a to to And as product of about, types to we you what market scale you service and those the to course, your on a Webscalars, packagable partners, annual I platform And that view, million model, as APIs need increase your at important. potential of Once second are creating obviously, with mean, to to as development hopeless if XX providers, so case side, partnerships revenue million building system developers a then to so whole scalable that evolutionary I on fundamentally yes. general XX towards the composites and and as really partner has the from strong that's different. be that's reach you own thing really, business be would product the to try years. reach that as model of that's There on. composites want we need your sure different the absolutely, a will higher talking moment, forward. industrial course, it service to the development you a service that margin over But coming recurring and

David Mulholland

Fredrik, question Thank Handelsbanken. Lithell We'll now take ahead. last from you, Richard. Fredrik please our from go

Fredrik Lithell

sort if wireless but coming fixed segments little for of XG tap show it's FWA for market XG how much. little to would years, Enterprise of contributes question. years new sort taking again, maybe Networks revenue the of and for terms frame I Enterprise been is market coming potential generation to Thank you what Thank wrong [indiscernible] in growth bit to like you bit, you'd the and here. my very us I brain like of about a if coming in on RAN access. or to we've Mobile your mean, you talking still several for it from the could RAN a aspect

how you sort sort a when you own comes down and of value, could to little XG So Thank like? about market you. that of the into bit Enterprise if trickles potential it their talk

Pekka Lundmark

compass substantially in fast wireless, that it's how of that first because it be, a the We that low a believers market RAN swing the a we it starts estimate all carrier potential lot it certain is date market, Enterprise extremes, that a extremely thing that to level. growth the strong noted that that will hard from faster than is only on could of between level the grow will are have and the

the more, where certainly carrier over market single in is can we low if likely see digits. years So at least XX%, the while XX%, market, grow most will the not time

You And our to is one networks is addition mentioned now Fixed Wireless of based growth. Access, is passive a the by in that that reason XG is a systems new driving key lot model, actually in why Networks fixed that market optical driven business, technically, not Mobile Infrastructure, Remember, is in radios there. though Wireless Fixed it's Access networks business growing Networks, course, fast. of so we delivering in are Network Fixed is our in even

growth the and anyone to to don't I potential. is will be that we So about bullish exactly are think But not coming detail mean over how years. the able I'm I market unfortunately, the able much

David Mulholland

Thank and gentlemen, call. concludes you, Fredrik. this Ladies today's

forward-looking results the that outstanding factors. call Actual I'd today, currently you the well results to and made number that both questions, involve If can Relations out have any a therefore differences from to expected. such that during be may internal you please statements the materially remind external uncertainties. do of free as Investor cause Factors feel operating like risks we've to reach could as differ team.

We available have on our Investor website. identified Annual thank risks our on Factors such Risk that, much. very Report is in XX-F you of the section which Relations Form With

Operator

presentation. conference for Thank you now is today's Thank attending you. concluded. The

now You may disconnect.

Nokia (NOK) 3 Feb 222021 Q4 Earnings call transcript