Bill Seymour, Vice President of IR Jorma Ollila, Chairman & Chief Executive Officer Rick Simonson, SVP, Chief Financial Officer

Has Malik, Citigroup Tim Long, Banc of America Securities Stuart Jeffrey, Lehman Brothers Wojtek Uzdelewicz, Bear Stearns Jeffrey Schlesinger, UBS Mike Walkley, Piper Jaffray Kulbinder Garcha, Credit Suisse

At this time I would like to everyone to Nokia's fourth-quarter and full-year 2005 earnings conference call with our host Mr. Bill Seymour, Vice President of Investor Relations. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer session. (Operator Instruction). I would now like to turn the call over to our host Mr. Bill Seymour. Mr. Seymour, you may begin. Bill Seymour, Vice President of Investor Relation: Ladies and gentlemen, welcome to Nokia's fourth-quarter 2005 conference call. I am Bill Seymour, VP of Investor Relations. Jorma Ollila, Chairman and CEO of Nokia, and Rick Simonson, CFO of Nokia, are with me today. During the call we will be making forward-looking statements regarding the future business and financial performance of Nokia and the mobile communications industry. These statements are predictions that involve risks and uncertainties. Actual results may therefore differ materially from the results currently expected. Factors that could cause such differences can be both external such as general economic and industry conditions as well as internal operating factors. We have identified these in more detail on pages 12 to 22 in our 2004 Form 20-F and also in our press release issued today. Our aim is to finish the call in approximately one hour. To view the supporting slides while listening to the call please log onto www.Nokia.com/investor. For your convenience a replay of the call will be available beginning two hours after the call ends today until Tuesday, 7 AM Helsinki time. The call will be archived on our website. With this it is my pleasure to pass the call over to Jorma. Jorma, please. Jorma Ollila, Chairman and Chief Executive Officer: Thanks, Bill. Welcome to the show. Ladies and gentlemen, I'm extremely pleased with the performance of the Nokia team in Q4 and 2005. In 2005 Nokia achieved record-breaking device volumes and had healthy device market share gains. Our 2005 net sales grew 16%, the highest growth we have had since 2000, and our EPS grew by 20%. We grew faster than the market in Q4 in device volumes year-on-year as well as sequentially. Nokia Network's sequential sales growth far outpaced the market in Q4 as well. There are a number of accomplishments to highlight in the fourth quarter. Nokia device volumes of 84 million were up 26% sequentially and 27% year-on-year leading to a market share of 34%. Based on our estimates Nokia is the only vendor of the top five to gain share sequentially in Q4, all the other players, including the number two vendor, lost market share. We're the clear number one device company globally. We are number one in all of Europe, all of APAC, Middle East, Africa, Southeast Asia Pacific, China, Russia as well as India. And we are number one in GSM, in EDGE, in wideband CDMA and in smart phones. During the fourth quarter we have made great progress in our entry-level business. The US market overall, CDMA, clamshells and wideband CDMA. And we continue to make good progress in steadily improving our mobile device portfolio. During the fourth quarter we introduced 20 new handsets. Nokia Networks had a strong quarter with sales up 25% sequentially and operating margins of almost 14%. During the quarter we bought back 121 million shares for a total of 315 million shares repurchased in 2005. Now I would like to make some brief comments about the overall device market. According to our estimates the fourth-quarter mobile device market was 244 million units, representing a year-over-year volume growth of 25% and sequential growth of 23%. The slide shows the detailed regional and technological market statistics as estimated for the fourth quarter. In general the market in the fourth quarter developed the typical way you would expect for a holiday selling season. But I would like to highlight a few specific points. Firstly, the global CDMA market was up 45% sequentially and in Europe, where our WCDMA share is strongest, the market saw tremendous growth. According to our estimates the global WCDMA market totaled 44 million units in 2005 and we believe that this will at least double in 2006. And it is also worth noting that the India market, where Nokia is a strong number one, continues to do extremely well growing over 20% sequentially. The device industry continued to grow at a very fast-paced in 2005. Nokia estimates that the global device market grew 24% in 2005 to 795 million units. A key driver of this growth was new subscriber additions in the emerging markets, a traditional Nokia stronghold. 2005 global net subscriber ads were approximately 420 million. We closed the year with an estimated 2.2 billion mobile subscribers globally, yielding a global mobile device penetration of 33%. Next I would like to cover some market share dynamics of our device business. Our fourth-quarter global device market share grew to 34%, up 1 percentage point sequentially. In terms of the specific markets for the fourth quarter. First of all US, we made excellent progress in the US market in the fourth quarter. Our volumes grew by close to 70% sequentially resulting in significant market share gains. We made very significant gains in our GSM market share in the fourth quarter and in CDMA our volumes were up over 100%. Our market share in the US was over 20% in the fourth quarter, moving us up to number two in the US, clearly closing the gap on the leading player in the market. Secondly, China, we did continue to gain share in China in the fourth quarter, marking ten quarters of uninterrupted market share increases. We closed the year with over 30% market share in China, ten percentage points higher than the previous year, further distancing us from the number two player, Motorola. And thirdly, the wideband CDMA market; we also there saw strong sequential growth in the fourth quarter in the wideband CDMA market. Our volumes grew by close to 80% resulting in significant global market share gains, solidifying our number one position in the technology and closing in on 30% global market share. For all of 2005 our global market share in wideband CDMA more than tripled. We also strengthened our position in APAC, driven largely by our continuing strong share in India. Our position in the fastest-growing market in the world continues to be extremely strong. We are number one in India, number one in Russia and number one in Middle East and Africa and number one in Southeast Asia Pacific. We estimate that on a sequential basis our sell in share was weaker in Latin America and Middle East Africa markets in the fourth quarter. These high-growth markets tend to be volatile and market share fluctuations are typical from quarter-to-quarter. We have taken actions to improve our position in these two markets and do anticipate that our share in both markets will rebound in the first quarter. There has been a lot of discussion about our share in the emerging markets, especially in light of the present GSMA handset awards. However, despite these developments, we estimate that we gained share in the emerging markets in the year of 2005. I would now like to discuss the ASPs and other portfolio dynamics of our devices business. Nokia fourth-quarter device average selling price was EUR99, down 3% sequentially. This is in line with our expectations and as we communicated to you coming into the quarter. As we predicted, the ASP decline was driven primarily by a seasonal shift in our units towards the lower ASP markets and the typical fourth-quarter mix shift to the low end in general. I would now like to highlight a few significant products for us in the fourth quarter. The 1100 continues to be top-selling product family with over 60 million units sold in Q4. As we have said, we are renewing the 1100 product family, systematically replacing it with our new lower-cost entry-level platforms. The 1110 and 1600 are the two primary entry-level products based on our new low-cost chipset. These two products were up over 300% in volume sequentially in the fourth quarter from already good momentum in the third quarter. The gross margins in our entry-level business have improved every quarter since the second quarter and the renewal of the product portfolio has been the primary reason. The 6101 GSM clamshell has been a hit for us. It was our third-best selling product family in the fourth quarter and our second-best selling product in both North America and Latin America. It has had a double impact. It is the first product to truly address our challenges in the clamshell market. And it has also had a significant positive effect on our US market share in the fourth quarter. The 6101 has been very well received by the US carriers and consumers because of Nokia's leading user Interface and quality, especially versus the competitor's offerings. As I mentioned earlier, we've continued to lead in the smart phone and wideband CDMA market. Smart phones now constitute over 10% of our device volume and close to 30% of value. Nokia continues to have the strongest wideband CDMA portfolio. Our wide band CDMA portfolio has much higher than average device margins leveraging a distinct cost advantage and a lead in the implementation of 90 nm chipsets. The 6630 and 6680 continue to be in the top ten for both revenue and profits in the fourth quarter for Nokia. But we are now seeing momentum behind the newly introduced N70. In the fourth quarter the N70 was already top five in revenue and profits in Nokia overall and was multimedia's number one product in revenue. This was achieved even though shipments began only in September. The stainless-steel 8800 slide phone continues to be a highly coveted and highly profitable model for us. Demand continues to outpace our growing supply as people discover its distinct elegant design in more and more markets. Now I would like to discuss our product lineup for the first quarter. We expect the following products to be the most significant in terms of shipments. In entry we will continue to ship the 1100 in big volumes, but, as I said, we are seeing that our new entry products such as the 1110, 1660, 30 are gaining ground fast. In the midrange we expect 6230i, and 6101 will continue to sell in high volumes. The new 6111 and 6280 slide phones should also ship in good volumes. In high-end and smart phones we expect to continue to ship N70, 6680 and 8800 in high volumes. Now I would like to talk about Nokia Networks. We expect improved results compared to the third quarter. But the Network's team performed even better than expected in the fourth quarter, both in terms of sales and margin. During the quarter we announced a number of GSM network expansion deals including a US$141 million contract with BSNL in India. We also announced a joint venture with China Putian to focus on R&D as well as manufacturing and sales of 3G network solutions for TDA, CDMA and wideband CDMA technologies. And at the Nokia mobility conference in Barcelona we and launched the highly innovative Flexi wideband CDMA base station which can deliver operators site cost savings of up to 70%. And let me now hand over to Rick who will do a little bit of numbers overview for you. Rick Simonson, SVP, Chief Financial Officer: Thank you, Jorma. Ladies and gentlemen, let me touch on the financials in some detail and first looking at the P&L. In the fourth quarter net sales were up 23% sequentially and 9% year-over-year, and on a constant currency basis sales growth was 13% year-on-year. Gross margins were up sequentially 40 basis points to 34.1% driven primarily by improvement in Network's gross operating margin. Reported group operating margins were down 50-basis point sequentially to 13.2%; but, if you exclude the special items related to both quarter three and quarter four, the operating margins were up 90 basis points sequentially to 13.5%. This improvement was driven primarily by improved networks margins and overall lower OpEx as a percentage of sales. So while the reported OpEx was up 90 basis points sequentially as a percentage of sales to 20.9%, again, excluding the special items from both quarter three and quarter four, OpEx was down 50 basis points to 20.6% of sales in quarter four. Sales and marketing was up sequentially as a percent of sales in quarter four and was a primary reason why we didn't deliver a bit more operating leverage in the fourth quarter. Strong marketing programs in multimedia and mobile phones contributed to most of this increase. Multimedia marketing programs in the fourth quarter include the continuing expenditure for the overall long-term establishment of the Nokia N series and for specific key products shipping in the quarter such as the N70. For mobile phones the 6101 and the imaging driving 6111 and 8800 were some of the big programs. The 6101, 8800 and 6111 are both positive brand drivers, but let me emphasize that they also are positive strong profit drivers. So we think the marketing spend being put against these products is well spent. As we discussed in our capital markets days recently, we are putting processes in place to make sure that we are spending our marketing wisely. And as we've also explained, we are measuring ourselves against new return on investment metrics for marketing, resulting in actions to make sure that we're getting the most bang for the buck. As Jorma said, Nokia Networks had a strong quarter. Better than we expected in both sales and margin. On sales much of the upside came late in the quarter and from a variety of customers and regions as the holding was able to execute well and deliver on some late quarter orders. Gross margin, it benefited from scale leverage from the higher volumes in Q4, regional mix and good product mix. And the operating margins clearly then benefit from the higher gross margins, the lower objects as a percentage of sales versus third quarter when you exclude Q3 special items. So as you can see, networks in the fourth quarter gross margins and operating margins benefited from a large sequential increase in sales. Networks operating profits are sensitive to top line sales given the higher OpEx requirement, and in this regard we should face the typical margin dynamics in the first quarter in networks given the normal first quarter decline in sales that are expected in the industry. Enterprise solutions, enterprise solutions results were disappointing and also significantly contributed to our inability to show that, a bit more operating leverage in the fourth quarter I referred to. The enterprise derived sales in the fourth quarter 2005 were impacted by the delayed operator acceptance of the Nokia 9300 enterprise smart phone in the US as well as some declining demand for our messenger product portfolio, all of this resulting in lower sales in all major markets. Enterprise solutions operating loss of EUR136 million was primarily impacted also by lower device volumes and a EUR29 million charge taken during the quarter. Enterprise solutions is taking steps to better address the corporate market including the pending acquisition of Intellisync, a leader in wireless messaging and mobile software. We are working hard to put together the leading package of enterprise devices, security, software, applications and services and we are convinced of the overall market opportunity and Nokia's coming financial success in this space. The new recently announced E series range truly is leading in all aspects and has had very positive reception from the corporate community and from operators. These products will not materially impact enterprise solutions revenue until quarter two, so Q1 will continue to be challenging. We strongly believe that the enterprise model is still largely untapped with incredible growth potential. Nokia is well positioned to exploit this and we are putting the pieces together to make it happen. Then a few specific financial items for 2006, and this is really a recap from the capital markets day and you should use for your modeling. We estimate that the tax rate for 2006 would be approximately 27%. We continue to estimate CapEx will be approximately EUR800 million and estimated depreciation and amortization will total approximately EUR800 million. Let me now review the fourth-quarter special items. Overall the net impact of the special items to diluted earnings per share was negligible. So the EPS excluding special items was 25 Euro cents, same as the reported number. And in terms of specific items, we took a EUR29 million charge for enterprise solutions restructuring primarily related to headcount reductions. Also in the quarter our tax rate in the fourth quarter was 24%; this lower than normal tax rate was a result of a EUR48 million onetime benefit from a tax refund. As I mentioned earlier, operating margin, excluding special items, was 13.5% versus 13.2% as reported. Let me update you also on the TELSIM auction in Turkey. As reported, TELSIM was auctioned for US$4.55 billion in December. Nokia's proceeds from the sale equaled 7.5% of the auction value, or US$341 million. We believe that we will be able to collect the proceeds sometime in the first half, but the exact timing during the first half remains somewhat uncertain. So for your modeling purposes as well the proceeds should be considered a special item. Next some very brief commentaries on currency. The fourth-quarter reported year-on-year sales growth was 9%, on a constant currency sales growth was 13%. On a sequential basis we saw modest benefits to sales growth from currency. Next let's look at some of the balance sheet and cash flow items. Inventory decreased sequentially in the fourth quarter reflecting a strong seasonal device market and healthy sell in for Nokia devices. Accounts Receivables were up sequentially due to customer mix and of course strong fourth-quarter sales growth. Operating cash flow was EUR1.1 billion in the fourth quarter, sequentially down from the third quarter driven, again, primarily by the higher receivables in the fourth quarter. Capital expenditure EUR183 million, up over the third quarter as planned, and CapEx for 2005 totaled EUR607 million, about as we estimated. Year end our net debt to equity was minus 77%. I'd like to emphasize here we managed down our cash and other liquid assets as planned and as communicated to you through our continuing significant share buyback. Our cash and other liquid assets stand at EUR9.9 billion euros at the end of 2005. During the quarter we repurchased 121 million Nokia shares for a total of EUR1.8 billion. This takes us to 72% of the value and 59% of the volume of our current share repurchase program. During 2005 Nokia returned a record EUR5.8 billion in dividends and buybacks to the shareholders. Let me summarize a few of the relevant Board of Director proposals that came out today. Nokia Board of Directors proposes today an annual dividend of 37 Euro cents per share. This represents a 12% increase to the dividend of 33 Euro cents per share of a year ago. The Board also proposes today a new 2006 authorization to buy back up to 405 million shares with a maximum value of EUR6.5 billion. All of the Board proposals are subject to shareholder approval in conjunction with our annual general meeting on March 30th. With this I'd like to now hand it back to Jorma. Jorma, please. Jorma Ollila, Chairman and Chief Executive Officer: Thanks very much, Rick. I'd like to cover the first-quarter and 2006 market and Nokia outlook very briefly. For the first quarter of 2006 Nokia does expect the overall mobile device market volumes to reflect normal industry seasonality following a strong fourth-quarter selling period. We expect our own share of the device market in the first quarter to be flat to slightly up sequentially, up year-on-year. We also expect the Nokia device average selling price in the first quarter to be flat or slightly down sequentially driven by a regional mix shift. Sales in our network business are expected to experience a seasonal decline in the first quarter, but be up year-on-year. For the full year 2006 we expect the mobile device market volumes to grow by more than 10% from our preliminary estimate of 795 million units this past year in 2005. We also expect that the device industry will experience value growth in 2006, but expect some decline in industry ASPs, primarily reflecting an increasing insight from the emerging markets. Nokia expects that the majority of the growth and over 50% of industry units in 2006 will come from emerging markets. Nokia expects that the replacement market will account for over 60% of industry device volumes in 2006. Nokia expects moderate growth in the mobile infrastructure market in euro terms in 2006. And our goal is to increase our market share both in mobile devices as well as in the infrastructure market. We are indeed entering this year with a strong product portfolio; great products are key but we are also taking actions to turn this critical product momentum more to our advantage. We have the most extensive distribution network in the world and we have one of the world's leading global brands. We will continue to leverage and extend these advantages. For example, in 2005 we conducted what I believe to be one of the broadest and most sophisticated segmentation projects in the consumer goods industry. The survey consisted of more than 60,000 hours of interviews done in 16 countries. In 2006 we will systematically apply what we learned from this study in retail. Last November we opened our first flagship store in Moscow and we are already seeing some very good traction there. We will be rolling out flagship stores in many more prime urban spots in the world, different parts of the world in 2006. Finally, thanks again to the exceptional Nokia team for delivering such excellent 2005 results. And we really are eagerly working on a great 2006 to happen. So I'll now turn to Bill for some final comments. Bill Seymour, Vice President of Investor Relations: Thank you, Jorma. Will now continue with the Q&A session. In order for us to be able to answer the questions properly please limit yourselves to one question only. Operator, please go ahead.

(Operator Instruction) Your first question comes from the line of Has Malik with Citigroup. Q - Has Malik: I'd like to ask two questions on multimedia division. Can you comment on the N series volume expectations in terms of what kind of approximate share of your total shipments in 2006 you hope to come from N series branded products? And second, when you talked about multimedia related marketing spending being higher than what you would perceive as normal levels, how much longer do you expect that to continue? Thank you. A - Jorma Ollila: Thanks for the question. It's clearly, if you look at the N series products, I think the comment would be that the second half performance overall for how we were able to ramp up and get the real volumes going with some real complex products was exceptionally good. So the ramp up capability that was demonstrated by the business group and the organization working on that was exceptional. So that really accounted for the better performance for multimedia than what we expected when we looked at the plans for the year 12 months ago, and really is ahead of plan overall. I don't have a figure, but it's a, the majority of the products already towards the end of the year were N series and will continue to be. The N70 being the top revenue generator among the N products, so I might even say that it's the great majority of the multimedia products being from the N series, so it's really moving towards the N series branded products within the division. Your second question related to the marketing and I think a couple of observations there. First of all, we have done a lot of work in terms of understanding the productivity of our marketing and sales on one hand and then the R&D expenditure on the other hand. What sort of gross margin are we getting short- or medium-term from those investments is a very major management parameter to follow and have systems in place to, not only to monitor but to get real planning understanding on what needs to be done. And I think, so we have a systems in place, like Rick mentioned in his presentational comments. So when we look at the marketing, and as you know, let's leave R&D, that question I'm sure will come later. So the marketing and sales costs have been under special scrutiny. And what is so interesting to see is now that we have had a higher level really for five quarters, five past quarters, what's interesting to see is that we see tremendous response and the response time is adjusting to be shorter than what we initially felt. So that when we really started towards the end of 2004, our investments in sales and marketing at the higher level and have been increased during the past year. We have seen not only our product awareness, but also the, sorry, the brand awareness but also the brand preference numbers in different parts of the world where we make those marketing investments to rise. And it's a careful balance between marketing based on brand support on one hand and then on the point-of-sale marketing support that we give. I think my comment would be that the high marketing expense, which many analysts, I understand, when they were looking at their models, the "high marketing expense" which we are said to be continuing to have, had actually brought tremendous results. I mean the results are there. Those results will even be amplified during the next 18 months when we have further interesting products. I think my comment would be, going forward that this is an industry which in the way that we kind of always saw but perhaps even amplified will always be both high R&D as well as high marketing cost. The successful companies here will have a high R&D and high marketing costs. And the question is how effectively you can focus and direct both of those costs. I think that as a percentage of revenue we obviously, reasonably soon we hope to see the marketing expense to go down and that needs to happen. How fast it will come, we will monitor that on a quarterly basis because in order to get this productivity aspect right. I'm sorry this was a longish answer, but this is one of those issues which we have worked on extensively and have nothing to apologize for the high-level because the results are there and they will be further coming in the next quarters to see. Q - Has Malik: Okay, thank you.

Your next question comes from the line of Tim Long with Banc of America Securities. Q - Tim Long: Can we just touch on the North American market a little bit? You talked about some real, real good share movement there getting back to 20%. Just give us your sense on how you view the sustainability of those share gains, particularly in light of some of the technology changes that are going on here moving from CDMA to EVDO and the move to WCDMA. So if you could just talk about how you feel about sustainability given the product cycle over the next few quarters as well as the technology changes. Thanks. A - Jorma Ollila: Thanks. If you look at first of all how after three not so good quarters particularly we were able to come back very well starting towards the end of the third quarter and now having what I would a very respectable quarter in terms of the share development in the final quarter. It's really coming from good products, both the improved GSM as well as the improved CDMA products. When I look at the momentum that I see as we speak in the US it's going to continue or extend into Q1. So this is not a one-off and we obviously see that we are well-placed to continue that momentum based on the discussions we have with the operators in GSM and in wideband CDMA when we go forward. But also we, as you know, we will be bringing a DO product and the CDMA recovery and getting back on track and into volume deliveries there to the key customers. That is very much happening. So being above 20, that's the first step. Now we will be stabilizing at a level which is above 20 and then going to the next step and really establishing ourselves hopefully as a strong contender for the number one position. That's not for me to talk about because I'm here for the first and second quarter. I think it will take a little bit more; so you'll have to talk to my colleagues and I'm sure they will enlighten you in the next conference call. Are you okay with that, Rick? A - Rick Simonson: We will be here and Tim will see me. Q - Tim Long: Thank you.

Your next question comes from the line of Stuart Jeffrey with Lehman Brothers. Q - Stuart Jeffrey: I've got a quick question on your emerging markets business. You mentioned in the text that you lost some market share in Latin America, Middle East and Africa. You said that you were hoping for that to bounce back in Q1. I was hoping that perhaps you could go into a bit more detail as to what it was that caused that market share to erode? Was it product issues? Was it pricing issues? What it distribution issues? Was it increased competition for example? A - Jorma Ollila: First of all, Middle East and Africa. Our share is very high and in that sort of a situation, when you have typically volatility in terms of some deals which have been priced at levels which don't long-term, which aren't destructive long-term for anybody. And then we decided to say no, we will not be party to this sort of an extravaganza just doing business for one-off. You know, then that very easily shows in a bit of a lower level. So it's this strong presence that we have which every now and then gets, because of the non maturity of the distribution on a broad basis in Middle East and Africa gets sort of disturbed, disturbed with spot deals. I think that's perhaps the best way to describe that dynamic. We are miles ahead in terms of building our distribution broadly in that region and we expect to be real strong and come back. So nothing special, difficult volatility and also some sell-in/sell-out issues there so our sell in doesn't necessarily tell the story about how the product moved from the shops. And that one can say knowing exactly that our trade inventory situation, channel inventory situation is very solid all the way in that region. On Latin America, that's traditionally an extremely fluctuating market in terms of deals moving back and forth and a lot of changes between different players. We have historically been either number one or two. There's one guy who's sort of very close to us and we tend to swap places quarter-to-quarter. So there is nothing special. Our somewhat lower than typical share was to have more than anything else coming from us not participating in some out sell CDMA action which was there in the market. That you can always take if you want, but if you decide in a good quarter with volumes moving otherwise, as was the case with us, why go in there? So nothing special. I don't think there's a big story, that's kind of what I'm saying. Q - Stuart Jeffrey: Just in the text you gave the impression that you lost share during the whole of the year, in 2005? A - Jorma Ollila: It was a little lower on both scores than in 2004, that's correct.

Your next question comes from the line of Wojtek Uzdelewicz with Bear Stearns. Q - Wojtek Uzdelewicz: Thank you, good afternoon. Jorma, I just want to get your sense on, I think some of the concerns that people or the call might make that, okay, well, Nokia, obviously you guys do great when there's a component tightness. So in the fourth quarter you definitely gained market share. You outperformed any of your competitors, there's no question about it. But then people say, okay, well, in Q1 there's a competitor who has several new product lines they could not execute in Q4, but they're going to deliver, come out with a more competitive offering. When you look, you've probably got a couple months already of the sense how the competition is doing with some of the new products. You have new products, I understand Japan and Korea are flat so you don't participate. So maybe on seasonal levels you're a little weaker because you don't play in those markets. But in your respective market what's your sense, how are you doing competitively against some of those new products? And related to that, because the big part of your story I think in the second half of the year is if you guys get right enterprise business that would be huge upside for the story; that's such a big market. Now it's a little bit underperforming. Are you accelerating some product developments there? Could you just touch on the milestones we should be looking? Because that's somewhat under performing but that's also such a huge area of upside for you down the road? A - Jorma Ollila: Two questions. First of all, we don't see any new pressure, new market dynamics coming from any one competitor in Q1. Our channel inventory situation is very good. I don't know the situation with other people exactly, but I think it's okay overall in the marketplace. So there shouldn't be any overhang. This is a healthy transition from Q4 to Q1. And that is coming through when you look at how the order book and how shipments are moving in the first five or six weeks which we have good visibility. So we feel good about our position with our products and nobody has come in with something which would make us feel that there is a new situation. There is not. Then on the dynamics towards the second half vis-a-vis the potential presented by the fact that we have been so heavily on the investment mode and continue to be. And the enterprise solutions, with that being such an early phase of the market with a lot of complexity in getting the solutions as well as the handsets which support those solutions to really get going. And I think obviously we have a lot of potential to turn this around into a much, much improved result in the second half. Yes, we are working very much toward second half being significantly better. You're already starting with some volumes of E series which we have launched during the second quarter, but you're putting on a finger in the second half is exactly correct. Q - Wojtek Uzdelewicz: Okay, thank you. But bottom line from the European markets or American markets at least, some of the thin phone factors from competitors, when you compare them for competitive reasons, you don't think that's going to impact your market are, at least based on what you see so far? A - Jorma Ollila: No, no, we don't see any new dynamics on that. No. Q - Wojtek Uzdelewicz: Thank you.

Your next question comes from the line of Jeffrey Schlesinger with UBS. Q - Jeffrey Schlesinger: Just two questions if I could. From an earlier question you talked about the market share gains in the first quarter and momentum in North America. Will that likely continue to put pressure on gross margin sequentially in the first quarter? And then second, Jorma, music continues to get a lot of attention in the mobile world, do you think the ecosystem is there? It appears to be very fragmented, a lot of people doing a lot of different things. Do you think that will be all in place to drive this market as we come to the second half and into '07? Thank you. A - Jorma Ollila: I missed the last bit of your question, the last sentence literally. Can you just repeat that, please? Q - Jeffrey Schlesinger: On the music side, do you think the ecosystem, which appears to be very fragmented now, portals, Apple's doing what it's doing, do you think that will be sufficient to actually drive this market towards the end of '06? Or how do you see that developing and Nokia's relationship? A - Jorma Ollila: Okay, so first of all, on the momentum and its impact on the gross margin in the, the US momentum and its impact on the margin. If you look at the gross margins in the US, the gross margins are slightly lower than the corporate average in the US because of the lower ASPs. US average ASP is lower. And so, but it's interesting because if you have a new good product like we have had a couple, as mentioned, in the final quarter, our ASP in the US went up from Q3 to Q4. So it's not so straightforward in what happens. And I wouldn't sort of draw a conclusion that there we go; the US is going to have a big impact. No, it certainly will not have a big negative impact. At worst it's muted and at best there can be good contribution coming from volumes and then the right kind of mix of midrange and the higher end phones. Because we are also making sure that the, we could benefit from the retail traction that we have for our high-end product even if we need to build a distribution, which is a retail distribution rather than through the operator. So I think we are moving nicely not with an explosive speed because it's difficult to do that ever in the US So don't count on having a big negative impact. No, there will not be one with us moving. But it's not a big positive impact either because of the intrinsic nature of the ASP level of the market. On music, yes, I think it was said that 2005 was going to be the year of music. It's all relative, it's in a fragmented way towards the year-end and everybody became aware. I think 2006 will actually be the year when it will be very broadly accepted and broadly a phenomenon in devices. We will be looking into music increasing in importance throughout the year accelerating towards the second half. So it will probably not be a big story, dramatic story in the first quarter or so, but then working towards the second half. There is a very positive expectation there and the volumes will be significant.

Your next question comes from the line of Mike Walkley with Piper Jaffray. Q - Mike Walkley: I was wondering if you could maybe just touch a little bit on the pricing pressure, especially with Motorola trying to go more into the emerging market. Can you maybe talk about any pricing pressure you might be seeing in those markets? And then, also you touched on given your large share and brand in some of those markets, any price premium you might have on some of those low-end products? That would be helpful. Thanks. A - Jorma Ollila: That's obviously an issue where it's about product and cost competitiveness, that's number one; number two, it's about brand; and number three, it's about distribution. And all have an importance. The relative importance of those three in the emerging markets varies from whether you are in an urban environment in Shanghai or whether you are in a countryside in India. So the relative importance can be very significantly different, but your overall business model has to be in shape in order for you to be successful. And I think that the fact that we have invested in a patient way into that has really paid off. And if there is somebody trying to catch us you can bet that we will be running with some really good sneakers at a faster pace and making sure that there's a gap. And it really, really comes about the overall business model, overall value chain being in good control. We did gain share in 2005 in the emerging markets overall. So if you look at Africa, Latin America, Asia-Pacific, India, China, Russia, if you take overall we have looked at how did we do. We gained share and it came in the first half because of the 1100 being in very, very good shape as a product and the second half increasingly 1110 and 1600 starting to perform and giving a real sort of spread of products. Not just one product priced desperately, but rather getting a breadth of products and that will be the story also in 2006. There will be new products. It's not that we're sort of phasing out some products which you saw in Europe or in the US two or three years ago that we would now then start shipping them. No, they are custom-made to emerging markets and cost optimized and feature optimized. So pricing pressure, no, we have not seen here. Had we seen significant pricing pressure you would not have seen the 17% margin in mobile phones in the fourth quarter. No, it's been well controlled in terms of good balance between taking deals and getting the volumes as well as making sure that we get a good return for our shareholders. And I think our folks; they are very, very good at doing exactly that in the field. So it's a great organization in that sense and if you look at the gross margin of our entry product line, it has improved since the second quarter of last year. So we have improved our gross margin in the emerging market product line since the second quarter of last year. So that's kind of as a summary the story about the price pressures and this and that competitor heading towards what used to be easy for us. No, this is not easy. This is challenging, but we are getting higher gross margin as a total impact of those factors which I mentioned.

Your next question comes from the line of Kulbinder Garcha with Credit Suisse. Q - Kulbinder Garcha: A question for Rick. If we look at the trend in your device gross margins, they've continued to I think reach new lows. And I'm just wondering as we head into now 2006 and level to about Q4, is that probably a low? Because I'm just thinking, you've talked a lot about the transition to your new low-cost platform. At some point I'm assuming that helps gross margins a bit in that part of the business. And I think you almost already said that there's some recovery already happening there. And also you've got the rise towards 3G where you've said before your profitability has materially accretive. So I'm wondering, is this the bottom and should we see a recovery or are there some other factors maybe in the early part of the year that may impact gross margins? A - Rick Simonson: Thanks for that. Why don't we talk a little bit of the positive and the negative factors of what will drive gross margin? I think Jorma outlined in the opening remarks and then with the question of Mike's really on this low-end, we are seeing the refresh there, positive impact there on the gross margins. It's something that we talk about a lot, last quarter and the quarter before that as we rotate from the 1100 to the 1110, 6030 so-called Scott chipset family. And I'd amplify there that we're talking about what kind of price premiums can you get there. Well, obviously initially when you come out with the replacement products for the 1100 you get some initial price premium while they're both selling in the market. But importantly what's happening is what we talked about, that many people are choosing the 1600 as their first entry phone. That's color. And again, to me, to my mind, way of thinking, that is kind of a price premium or a price step up, it's a rotation up that gives us opportunity. And so we are executing that, as we said. We're seeing the benefit there, but we don't stop there. Like we talked about just a number of weeks ago in December in New York, what's the next step? Well, it's the low-cost single chip entry and, again, we expect to have the combined benefits there of some, again, some bill of material cost advantage compared to the current platforms and then you get this effect of having new product in and you can work up the ladder. So that's a positive impact. Clearly WCDMA, the 3G device is our strong position there and the potential for the industry where we think volumes are going to more than double plays into our favor and we continue to ramp some new products in the mid to high-end. In the nearer term on gross margins, if you look at Q1, you look at there's a little bit of the normal seasonality in terms of regional mix development. We talked about share expecting to be as a percentage of our overall mix a bit higher in North America in Latin America, as we talked earlier, and those are going to, that does have a little bit of pressure, as we talked about; not extreme but some muted negative pressure on gross margins there as they're lower than the global average. It's both in general of the North American and Latin American market and then specifically also related to CDMA portfolio which has a little bit of the pressure the other way. So again, and we pointed out earlier on this low end side, we still haven't made the full rotation away from the older product family, the 1100 to the new Scott family. Remember, that's in transition. We're still selling more volume of the 1100 than we are of this new family. We said that it would be towards the end of '01 when we start to have that crossover point going into quarter two is what we talked about with you. So that's kind of how I see the dynamics. Clearly in the fourth quarter, as I mentioned, overall corporate gross margin improved by 40 basis points. But as you can clearly see, that's primarily driven by networks, the pick up there above, in general and a little bit above expectation. And of course that will have a little pressure and normal seasonality in the first quarter. So that's how I see kind of the pluses and the minuses there, Kulbinder. Q - Kulbinder Garcha: Okay, thanks very much. Bill Seymour, Vice President of Investor Relation: Ladies and gentlemen, this concludes our conference call. I would like to remind you that during the conference call today we made a number of forward-looking statements that involve risks and uncertainties. Actual results may therefore differ materially from the results currently expected. Factors that cause such differences have been identified in more detail on pages 12 to 22 of our 2004 Form 20-F and also in our press release issued today. Thank you and have a nice day.

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