Nokia Targeting US$200 Billion Market

At the company's Capital Market Days yesterday, Nokia outlined its strategy for growth in the expanding multimedia and enterprise markets while continuing to capitalize on the mobile voice market. Based on 2003 market value estimates, Nokia believes that the combined markets of voice-optimized devices, imaging, games, media, and enterprise mobility and mobile networks represent a US$238 billion addressable market for the company.

Nokia's strategy is designed to drive growth in net sales. The company says that the imaging, games, media, and enterprise mobility device markets offer it excellent growth potential while there still are opportunities to increase Nokia's market share in voice-optimized device and networks markets. Assuming favorable development of the defined addressable market and successful implementation of the company's strategy and new operational structure, Nokia has a long-term target to achieve an average annual net sales growth of at least 10 % at constant currency.

Nokia currently predicts that the 2003 mobile phone market volume will be approximately 460 million units and expects 2004 market volume growth to be somewhat over 10%. The company continues to target faster-than-market growth. Nokia sees the overall mobile infrastructure market stabilizing and expects the 2004 market to be at the same level as in 2003.

Sales and profit contribution based on the new structure Under the new Nokia structure, four business groups - Mobile Phones, Multimedia, Networks and Enterprise Solutions - will have profit and loss responsibility. Based on current Nokia sales estimates, Mobile Phones would account for approximately 65% of Nokia's fourth quarter 2003 sales, Multimedia slightly above 10%, Networks slightly below 20%, and Enterprise Solutions about 5%.

Nokia is already seeing early signs of growth in the Multimedia market. Volumes of camera phones exceeded volumes of digital still cameras already in Q2 2003, making Nokia the world's largest digital camera supplier in 2003. Nokia's leading range of imaging devices together with improving features, such as megapixel cameras for 2004, are driving the imaging strategy. A steady flow of 100 new game titles by the end of next year will support the company's strategy in games.

Nokia's mobile phone volumes continue to grow faster than the overall mobile phone market volumes, resulting in market share gains in 2003. The favorable development of Nokia's mobile phone market share in 2003 has resulted in a clear number one position in the United States and a number one position in GSM in China. Nokia has also doubled its share of the global CDMA handset market in 2003.

For the fourth quarter 2003, Nokia sees that the mobile phone market has continued to develop well based on indications of strong industry demand and healthy channel inventories. The company's own mobile phone volumes are progressing according to plan. In infrastructure, both the overall market and Nokia Networks performance are developing as projected."

Posted to the site on 25th November 2003