NSN Form 2013

Notes to the Consolidated Financial Statements
Enabling
a mobile
world
Annual Report 2012
4
Nokia Siemens Networks
Overview
Business review
Governance
Financial Statements
1
2
12 Chief Executive Officers

strategic review
16 Our senior management
team
18 Our strategy and
transformation
21 A word from our customer:
SK Telecom
22 Industry trends
24 How we operate
26 Where we operate
KDDI
29 Operating and Financial
Review
TeliaSonera
48 Corporate responsibility
50 Risk factors
Safaricom
54 Corporate Governance
Consolidated Financial
Statements 2012
Enabling a mobile world

A word from our customer:
U.S. Cellular
4 Who we are and what we do
6 2012 highlights
8 A letter from our Chairman
9 Our Board of Directors
SoftBank
62 Consolidated Income
Statement
63 Consolidated Statement
ofComprehensive Income
ofFinancial Position
ofCash Flows
ofChanges in Shareholders
Equity
67 Notes to the Consolidated
Company Financial
Statements2012
118 Company Statement

ofFinancial Position
119 Company Income
Statement
120 Notes to the Company
Other Information
127 Proposed profit

appropriation
127 Proposed appropriation
ofresult
127 Subsequent events
128 Independent auditors
report
129 Glossary
Visit our Annual Report online

nokiasiemensnetworks.com/annualreport
Weve focused our business on mobile

broadband. This is our speciality. We help
mobile operators grow profitable
businesses that realize the extraordinary
potential of mobile broadband. The work
that we do powers some of the most
exciting opportunities for our generation
andwill do so for generations to come.
Within these pages you will find out more
about who we are, our turnaround, how we
are building the infrastructure for the next
generation of mobile networks, and how
delighted our customers are in their
relationship with us.
We welcome you to an exploration of how
we are enabling the mobile world.
for a world in motion
Annual Report 2012
A word from our customer
Helping to build customer loyalty

A partner who helps
us keep our promises
to our customers
thats the must for us.
Mary N. Dillon, President and
Chief Executive Officer, U.S. Cellular
Read more about

our work with U.S. Cellular
in our online Annual Report
Country: United States

Number of customers: 5.8 million
Strategic focus: Customer
satisfaction with state-of-the art
network services
2
Overview
1
2
4
6
8
9
10


A word from our customer: U.S. Cellular
Who we are and what we do
2012 highlights
A letter from our Chairman
Our Board of Directors
A word from our customer: SoftBank
Annual Report 2012
Overview Who we are and what we do
The worlds mobile

broadband specialist
Nokia Siemens Networks,

a joint venture between Nokia
and Siemens, is the worlds
specialist in mobile broadband.
We provide mobile operatorswith
hardware, software andservices to
plan,design and build their networks;
tooperate and maintain those
networks;and to enhance their
customers experience.
Across the world, the demand to be connected anywhere, anytime,

using any device, is exploding. Addressing that challenge requires
network infrastructure that only very few companies can provide
and Nokia Siemens Networks is one of those companies.
Our focus is on the mobile broadband technology and services
thathelp mobile operators to meet the challenges of today and
tomorrow: from the radio equipment found on towers and rooftops
around the world, to the sophisticated software systems that
manage complex networks, to the services that make it all
worktogether.
Our customers include most of the worlds leading
telecommunications companies, including Amrica Mvil, China
Mobile, Deutsche Telekom, SoftBank, Telefnica, T-Mobile USA,
Verizon and Vodafone.
Our organization is based on two businesses units: Mobile
Broadband and Global Services. In 2013, we have customerfocused sales and delivery organizations grouped into three large
geographical areas: North America, Europe and Latin America,
andAsia, Middle East and Africa.
Our business units

Together, our Mobile Broadband and Global Services business units ensure that mobile
operators can efficiently provide their customers with a superior experience.
Mobile
Broadband
Global
Services
Mobile Broadband
Our Mobile Broadband business unit provides mobile
operators with radio and core network software together
withthe hardware needed to deliver mobile voice and data
services. The product portfolio includes Liquid software,
which allows unrivalled flexibility and adaptability including
migration towards a cloud architecture; network management
tools that provide a real-time view of the network performance
and quality of service; and customer experience management
software that monitors and adapts network and service
experience.
Global Services
The Global Services business unit provides mobile
operators with a broad range of services, including
professional services, network implementation and
customer care services. Within professional services
arenetwork planning and optimization, systems
integration and managed services for network
andserviceoperations.
Key statistics
Achievements
An industry-leading 4G
(LTE)portfolio with 77
commercial contracts
atyear-end 2012
58 400 employees
Named number one

inLTEinnovation and
implementation for the
second year in a row by
ABIResearch
Only company supplying

LTE radio technologies to
allmajor mobile operators
inJapan and South Korea
3 million mobile base stations in service
todate
A powerful services player
that has articulated a
credible plan on how it
intends to focus, according
to Current Analysis
Deployed networks that help people stay

connected in over 150 countries
Substantial improvements
inall areas of product quality,
including a 32% year-onyear reduction in open
customer defects
Annual Report 2012
Overview 2012 highlights
Execution, progressand momentum
In 2012, Nokia Siemens Networks made

significant progress in executing its
strategy to focus on mobile broadband.
The impact is visible in the vastly
improved financial performance and
operational achievements over the year.
From a financial perspective, it was the
best year in our history.
Operationally, it was a milestone year as
well. Our efforts to deploy our innovative
technology into thehigh growth areas of
the mobile broadband market showed
strong momentumand, importantly,
received strong endorsement from
ourcustomersand positive reactions
fromindustry analysts.
Financial highlights
13.4bn
Full-year sales of 13 372m, down slightly from 13 645m

in2011despite divestments and significantcountry and contract
exits as part of our restructuringprogram.
822m
30.7%
1.3bn
Operating profit before specific items* of 822m, up145%
from335min2011.
Significant improvement in gross margin before specific items*

to30.7%,up from 27.5% in 2011.
Rigorous working capital management helped to drive positive

cashflowinevery quarter of the year, strengthening
theGroupscash position, with a net cash positionof1285m in
2012, up from 8m in 2011.
Key financials 2012

EURm
Net sales
Operating profit before specific items
Operating profit % before specific items
Operating loss after specific items
Operating loss % after specific items
Loss for the year
EBITDA before specific items
13 372
822
6.1%
(741)
(5.5%)
(1 445)
1 094
*T
he before specific items financial measure excludes specific items for all periods:
restructuring charges, country/contract exit charges, merger-related charges,
purchase price accounting related charges and other one-time charges.
t December 31, 2012, Optical Networks was classified as a disposal group
A
heldfor sale and is presented as discontinued operations on a separate
incomestatement line, Loss for the year from discontinued operations.
Allcomparative Optical Networks results for the years ended December 31,
2011and 2010 have been re-presented as discontinued operations on the
faceof the income statement.
Operational highlights
Successful transition to a focused
mobile broadband company:
Achieved world record 4G mobile

network throughput at 1.6 Gb per
second in 2012. This was our fifth
straight 4G speed record in 2012.
Flexi Zone is by far the most innovative

approach taken by any of the tier one
Original Equipment Manufacturers
(OEMs). Michael Thelander, Chief
Executive Officer and Founder, Signals
Research Group
Through selectively exiting non-core

lines of business, NSN has also moved
to transform its corporate culture to
achieve a flatter, more responsive
structure. When combined with efforts
to establish quality as a differentiator,
NSN is creating a nimble and effective
competitive force. Ken Rehbehn,
Principal Analyst, Yankee Group
Demonstrated our commitment

tostaying at the forefront of mobile
broadband innovation with the opening
of a mobile broadband testing and
development facility at Silicon Valley
inthe USA.
Introduced industry award winning

CEM on Demand solution, a userfriendly online portal for managing
customer experience:
NSNs early championing of CEM, as
early as a year ahead of rivals, is likely
responsible for the companys positive
recognition among operators.
Jason Marcheck, Service Director,
Current Analysis
Unveiled industry award-winning Flexi

Zone solution for deploying a small cell
overlay for fast and flexible 4G network
coverage in high-density areas:
Launched the first vendor operated

Service Management Capability Center
for global delivery of service operations
and management:
Demonstrated the reliability of core

virtualization and cloud management
witha top global operator (part of the
leading Liquid Core architecture).
We are delighted that Nokia Siemens

Networks has come up with an
end-to-end approach to manage the
service lifecycle efficiently and thus
enhance customer experience to a
newlevel. Vishant Vora, Director Technology, Vodafone India Ltd,
Vodafone India
Developed the groundbreaking Liquid

Applications which redefines the role of
the base station by turning them into
local hubs for service creation and
delivery, and transforming the mobile
broadband customer experience.
Maintained the lead and strong

performance in packet core:
Nokia Siemens Networks mobile

packet core solution is very threatening
in the market, because it was one of the
early EPC solutions and has maintained
market momentum with major mobile
operators based on functionality and
quality of experience, and now with
class leading performance. Glen
Hunt, Principal Analyst, Current Analysis
Annual Report 2012
Overview A letter from our Chairman
A year of significant progress
In this letter my first as Chairman of NokiaSiemens

Networks I am pleased to report ayearofsignificant
progress.
Towards the end of 2011, we announced a new strategic direction,
along with a substantial, two-year restructuring program designed
togive us a strong foundation for the future.
Those efforts are already showing results. We delivered the best
financial performance in our six-year history, with operating profit
before specific items up 145% to EUR 822 million. After specific
items, we reported a full-year operating loss of EUR 741 million,
reflecting theongoing costs of our investment into restructuring.
Over the course of 2012, deep structural changes were made to
Nokia Siemens Networks that will enable it to better compete in
coming years. Non-core businesses were divested; headcount
wassignificantly reduced; poorly performing contracts and
countries were exited; non-personnel costs were reduced; pricing
discipline was improved through centralization; leadership was
upgraded; quality was enhanced; roadmaps were stabilized;
andoverall governance was strengthened.
Given this progress, we were able to raise our cost savings target
inearly 2013.
The longer term view of Nokia

Siemens Networks is that our new
strategy, combined with excellence
in execution, enables us totarget
ona longer term an operating margin
ofbetween 5% and10%*.
To be clear, however, our work is not yet done, and significant

opportunities for further improvement remain. Product quality
canbe further improved, and roadmaps better aligned to customer
needs. Productivity and efficiency can be strengthened. Employee
morale and engagement can be boosted. In short, while we have
made considerable progress, the speed and momentum of our
change must continue in 2013.
Maintaining this progress is essential as we do not expect a
significant change in market conditions in 2013. Despite strong
underlying fundamentals, particularly continued data traffic growth,
we expect the mobile broadband market to be relatively flat, as
operators maintain tight control of both capital and operating
expenses and macro-economic conditions remain uncertain.
Asaresult, of this market environment, we expect competition to
remain challenging.
Looking forward, I remain confident that our new strategy and
underlying structural changes put Nokia Siemens Networks on
theright path to become a sustainably profitable business. Our
longer term view is that the new strategy, combined with excellence
inexecution, enables us to target on a longer term an operating margin
of between 5% and 10%*.
The publication of this report in which we are sharing details about
the performance of our business at a more granular level than ever
before is a step forward in greater transparency and engagement
with stakeholders both externally and internally. In introducing it, I
would like to thank our shareholders Nokia and Siemens for their
support of Nokia Siemens Networks, and to take this opportunity to
thank all our employees for their dedication and commitment to the
business. Their actions have helped us to deliver a game-changing
year for Nokia Siemens Networks and have made a real difference
inpositioning the Group for the future.
Jesper Ovesen
Chairman
* Excluding specific items.
Overview Our Board of Directors
Drawing on
our expertise
Left to right:
Jesper Ovesen
Chairman of the Board
of Nokia Siemens Networks
Juha krs
Executive Vice President
Human Resources of Nokia
55
To find out more about

our Board of Directors
see p55
Timo Ihamuotila
Chief Financial Officer of Nokia
Louise Pentland
Chief Legal Officer of Nokia
Joe Kaeser
Member of the Managing Board and
Chief Financial Officer of Siemens
Peter Y. Solmssen
Member of the Managing Board and
General Counsel of Siemens
Barbara Kux
Member of the Managing Board
and Chief Sustainability Officer
of Siemens
Outgoing
Niklas Savander
Riikka Tieaho
Siegfried Russwurm
Annual Report 2012
Readying the network for iPhone 5

We are committed to offering
the very best mobile broadband
experience to our customers.
That requires quick thinking, a
flexible approach and extremely
innovative problem-solving.
Junichi Miyakawa Executive VP,
Director & CTO, SoftBank Mobile
Read more about our work with SoftBank

Country: Japan
Number of subscribers: 31 million
Strategic focus: Information
Revolution Happiness for
everyone
10
Overview
Business
review
12
16
18
21
22
24
26
28
29
47
48
50
52

Chief Executive Officers strategic review

Our senior management team
Our strategy and transformation
A word from our customer: SK Telecom
Industry trends
How we operate
Where we operate
A word from our customer: KDDI
Operating and Financial Review
A word from our customer: TeliaSonera
Corporate responsibility
Risk factors
A word from our customer: Safaricom
Annual Report 2012
11
Business review Chief Executive Officers strategic review
Delivering on a promise
Key achievements in 2012

Delivering against our
mobile broadband
strategy including
divestment of five
non-core businesses
Excellent progress
made in delivering
cost savings
Operating profit before

specific items increased
by 145%
Positive cash generation
led to a net cash position
at the end of the year of
1.3 billion
Areas for focus for 2013

Building on our
progress in quality and
innovation in mobile
broadband products
and supporting
services
Strong performance in
all key geographical
markets
Strong cash
generation
Rajeev Suri
Chief Executive Officer
12
A little over a year ago, Nokia Siemens Networks

announceda bold new direction. We said that we would
become the worlds leading mobile broadband specialist by
focusing on this specific market, dedicating ourselves to
world-class innovation to meet ourcustomers needs, and
achieving quality of such an exceptionally high level that it
would become a key differentiator for us.
At the same time, we launched a substantial two-year restructuring
and transformation program, designed to build a business that can
succeed in todays market and take advantage of future industry
dynamics.
Improving financial performance
Nokia Siemens Networks 2012 financial results are testament
bothto the strength of our vision and the effectiveness of our
restructuring. The benefits of our strategy became apparent
inthesecond half of the year, when we set new quarterly records
with our highest ever gross margins and operating margins.
Nokia Siemens Networks 2012

financial results are testament both
to the strength of our vision and the
effectiveness of our restructuring.
On a full-year basis, operating profits before specific items increased
145% to EUR 822 million, making 2012 the best year in our six-year
history. Gross margin before specific items rose year-on-year from
27.5% to 30.7%. We significantly improved our cash management,
ending 2012 with EUR 1.3 billion in net cash. Net sales at EUR 13
372 million were virtually the same as in 2011, even after our
portfolio streamlining, divestments and exits from less-profitable
contracts and countries.
Based on the strength of this performance, we managed to improve
the maturity profile of our EUR 600 million term loan, extending it to
March 2014.
Net sales
EUR million
14 000
13 645
13 372
13 500
13 000
12 500
12 206
12 000
2010
2011
2012
Operating profit before specific items

EUR million
900
822
700
500
335
300
166
100
2010
2011
2012
Gross margin before specific items

%
30.7%
31
30
29
28.2%
28
27.5%
27
2010
2011
2012
Annual Report 2012
13
Business review Chief Executive Officers strategic review continued
An effective restructuring
At the heart of this story lies a well-designed and effectively
executedrestructuring. In connection with outlining our strategy in
November 2011, we had set ourselves the goal of delivering
EUR 1 billion in cost savings. We were able to raise that target in
early 2013, whereby Nokia Siemens Networks targets to reduce
annualized operating expenses and production overheads,
excluding specific items by more than EUR 1 billion by the end of
2013, compared to the end of 2011.
During 2012, we decreased indirect spending by a fifth. We have
reduced our real estate footprint by approximately 408 000 square
meters. Internal headcount is down by approximately 20%. Five
businesses have been divested, with two more divestments
ongoing. We have exited multiple poorly performing contracts and
ceased from active business in several countries. IT outsourcing
agreements have been signed with ATOS and Wipro.
The restructuring is not just about cost savings, however, but also
about making deep structural changes that will bring us benefits
wellinto the future. For example, we have brought new rigour to
contract management, limiting the impact of ongoing price erosion;
simplified our organization in order to clarify decision-making
andaccountability; and moved forward to renew many of our
end-to-end processes.
Delivering against our strategy
To meet our aim of becoming a mobile broadband powerhouse, we
have focused, both in terms of technology and geography. We have
also put a strong emphasis on quality and innovation as important
differentiators. In 2012, we showed that we are already delivering
against that strategy.
Focus
Our focus on mobile broadband has enabled us to increase our
strengths in this segment. For example, industry analysts put our market
share of 4G (LTE) at about 20%, confirming us as a strong number two
player in this important, fast-growing mobile technology. Our strong
position extends well beyond radio into areas such as professional
services, 4G IMS core, Customer Experience Management (CEM),
Subscriber Data Management (SDM) andbeyond.
We have refocused our attention geographically, categorizing our
regional business according to market conditions. In 2012, this
approach led to successful contracts in the advanced markets of
Japan, South Korea and the USA; significant improvements in the
previously weak Middle East and Africa; and solid performance
across the rest of the markets in which we operate.
Services remain an important part of our business, sharply focused
on those activities that enable our customers to fully exploit the value
of their mobile broadband investments. Our Global Services
business unit showed improved profitability during 2012, partly due
to a refocused portfolio. We are fully committed to taking the units
profitability higher in the future.
14
Quality
Our goal is to ensure that mobile operators can provide their
customers with the best experience. Achieving this requires an
unwavering commitment to quality and we have made that
commitment.
We believe that we can differentiate on quality by concentrating on
the aspects that are most important to mobile operators and their
customers. While we monitor many quality metrics, we have
identified six key ones which are regularly monitored at Board level.
These indicators contribute the most significantly to ensuring the
best experience for mobile operators customers and all showed
significant improvement in 2012.
To take just one example, 24 out of 28 programs met their path to
virtual zero software quality targets. This is a sophisticated quality
improvement technique in which product development projects are
measured against very strict quality goals. This is just one of the
world-class processes that we are proud to have adopted from
Motorola, a recognized leader in quality.
To support our focus on quality, we made the hard decision in 2012
to reset our product roadmaps. This action was not taken lightly, but
we believe that it was necessary to provide our customers with the
quality and predictability that they require. Since this reset, we have
seen a dramatic improvement in the on-time delivery of new
products and features.
Innovation
Our commitment to Research and Development (R&D) is as strong
as ever. We have increased R&D spend in our key businesses and
reduced R&D spend overall to align with our refocused portfolio. For
example, R&D investment for next generation radio and core
increased by 18% between the start of 2011 and the end of 2012.
Our goal is to help fix the real world problems that mobile operators
face and to provide the advanced technology that will give them a
leading edge in competitive markets. Innovations such as our Liquid
Radio which enables the network to adapt to changes in demand,
or in our CEM solutions which help operators maximize the
business returns from network investments demonstrate that our
newly-focused approach to R&D is already paying off.
Recent projects include Dense RAN which is an innovative way to
improve the user experience for mass events like rock concerts,
sporting events and so on at which upload traffic is much higher
than download (as people take and send photos and videos to
friends). This usage is contrary to the usual usage pattern, in which
download demand is higher than upload.
Strong intellectual property development is also a key part of our

customer-focused innovation strategy. In the fourth quarter, we
generated over EUR 35 million in intellectual property revenue and
we will continue to consider licensing or selling patents where doing
so makes sense for our future.
Looking forward
2013 will continue to be a year of change at Nokia Siemens
Networks as we shift our focus from restructuring to transformation.
While we have made remarkable progress, we also recognize that
there is more to do.
2012 also saw the opening of our mobile broadband testing and
development facility in Silicon Valley. Our products and solutions
continue to collect honors from industry peers. These include the
Global Telecoms Business Innovation Award 2012 for our CEM on
Demand products, which are helping mobile operators like
Telkomsel gain deeper insight into their customers experience. We
also launched our Flexi Zone approach for small cell coverage, which
won in its category at the Best of 4G Awards, 4G World and the
Small Cell Forum Industry Awards 2012.
Our priorities in 2013 include completing our restructuring,

consolidating our progress in quality, and accelerating our
innovation. We will continue to develop our customer relationships
and ensure that we remain a strong, global player in mobile
broadband and supporting services.
Our people
2012 was a challenging year for everyone at Nokia Siemens
Networks. The significant headcount reduction program that we
started last year was naturally a difficult exercise. Nevertheless, we
saw a nine percentage point increase in the proportion of employees
expressing support for our direction. We will make efforts during
2013 to continue increasing our employee engagement, satisfaction
and motivation.
Maintaining a strong financial position and liquidity profile is another

key focus area. We will continue to work towards our long-term
financial goals which include longer term financing as a way to
diversify our funding sources. We have become a far more efficient
business in 2012 and will continue those efforts until we become the
leanest, most productive company in our sector.
We have reason to be pleased with our 2012 performance, but we
are not yet satisfied. Our work continues and we expect to end 2013
in an even stronger position than we are in today.
Rajeev Suri
Over the course of the year, we made Nokia Siemens Networks a

safer place to work, with a priority placed on employee health and
safety. This effort has resulted in a 29% reduction in the number of
health and safety recordable incidents.
2013 will continue to be a year of

change at Nokia Siemens Networks as
we shift our focus from restructuring
to transformation. While we have
made remarkable progress, we also
recognize that there is more to do.
Annual Report 2012
15
Business review Our senior management team
The leadership we need

to deliver our strategy
Rajeev Suri
Chief Executive Officer (CEO)
Samih Elhage
Chief Financial Officer (CFO)
Rajeev has more than 23 years of international

management experience. He is a leader who
cherishes the opportunity of transformational
and turnaround assignments. Rajeev has
worked in roles comprising strategy and M&A,
product marketing, business intelligence, sales,
major account leadership, regional and business
unit leadership and has lived in the Middle East,
Asia, Africa and Europe. Rajeev joined Nokia in
1995, headed the Asia Pacific region in Nokia
and Nokia Siemens Networks, then transformed
and grew the Global services business unit.
Rajeev has been CEO since October 2009
presiding over consistently improving results
anda fundamental reshaping of the strategy
leading to the successful turnaround and
restructuring of Nokia Siemens Networks.
Rajeev is based in Espoo, Finland.
Samih has 23 years experience in the telecoms

industry. He has deep experience in financial and
operational management. He has substantial
experience in building high performing
organizations, leading business transformations,
and establishing operational excellence
invarious global markets. Before joining
NokiaSiemens Networks in March 2012, Samih
served as a senior advisor to leading private
equity and global management consulting firms,
and as a senior operating executive at Nortel.
Heis based in Munich, Germany.
16
Deepti Arora
Vice President, Quality
Deepti is responsible for Nokia Siemens
Networks quality strategy and related execution.
She joined Nokia Siemens Networks in 2011
from Motorola Wireless Networks, where she
held the role of Head of Global Quality. Before
this, Deepti was responsible for platform quality
andproduct performance at Motorola Mobility,
and led business operations at Motorola
Software Group. She is based in Chicago, Illinois,
in the USA.
Kathrin Buvac
Vice President, Corporate Strategy and
CEOOffice
Kathrin has 12 years of international
management experience in the telecoms
industry, having held positions in financial
management, auditing, integration planning
and synergy execution. Kathrin has been
instrumental in building Nokia Siemens
Networks current strategy. Her responsibilities
cover corporate strategy, Secretary to the
Executive Board and Chief of Staff to the CEO.
She is located in Munich, Germany.
Hans-Jrgen Bill
Executive Vice President,
Human Resources
Hans-Jrgen has a long history of developing new
opportunities in the telecoms market and has
worked with many of the worlds largest global
operators. He brings his diverse and extensive
business leadership skills to the development of
Nokia Siemens Networks workforce strategy.
Heis based in Munich, Germany.
Ashish Chowdhary
Executive Vice President/ President,
Asia, Middle East and Africa
With Nokia and Nokia Siemens Networks since
2003, Ashish has held numerous global
general management roles in technology and
telecoms, most recently serving as our Head
ofGlobal Services. Ashish is a hands-on,
results-driven executive, with a track record in
building high-performing international teams.
In September 2010, he was named one of the
Top Ten Movers and Shakers in the global
telecommunications sector by Light Reading.
He lives in New Delhi, India.
Barry French
Executive Vice President, Marketing,
Communications and Corporate Affairs
Barry has been a member of the senior
management team since Nokia Siemens
Networks was created. His responsibilities
include marketing, communications,
government relations, and occupational
healthand security. He has a wide range
ofexperience in Fortune 500 companies
across many sectors. He lives and works
inLondon, UK.
Alexander Matuschka
Chief Restructuring Officer
Alexander has gained extensive experience in
various positions in the automotive and
machining industry including restructuring,
re-organization, procurement, logistics, supply
chain management, and lean manufacturing
and assembly. He was an industrial advisor for
private equity companies before joining us in
2011. He is based in Munich, Germany.
Hossein Moiin
Executive Vice President, Technology and
Innovation
Hossein joined Nokia Siemens Networks in
2010, having held senior technology positions
at BT, T-Mobile and Sun Microsystems. As well
as guiding our technology and innovation
direction by providing long-term views on
network architecture and its evolution, he is
responsible for our research and IPR. He is
based in Espoo, Finland.
Marc Rouanne
Executive Vice President,
Mobile Broadband
Marc has 20 years of international
management experience in the telecoms
industry, having held positions in R&D,
customer operations, and product
management. He was responsible for ensuring
that Nokia Siemens Networks was the first
inthe world to ship 4G (LTE) compatible
hardware to customers in 2008. He is based
inEspoo, Finland.
Ren Svendsen-Tune
Executive Vice President/ President,
Europe and Latin America
Prior to joining Nokia Siemens Networks in
2012, Ren was chief executive of Teleca, a
supplier of software services to the mobile,
consumer electronics and automotive
industries. Before that he spent 13 years with
Nokia, where he served in a range of positions,
including Senior Vice President of Global
Customer and Market Operations. He is
basedin Munich, Germany.
Annual Report 2012
17
Business review Our strategy and transformation
Creating value
In November 2011, Nokia Siemens

Networks announced a new strategy
founded upon three key pillars:
1Focus
2Innovation
3Quality
While we intend to continue to adjust
our strategy as the market evolves,
our commitment to these pillars is
fundamental to how we create value.
The progress that we made in 2012, and
our significantly improved financial
performance, are both early validation
of the strategic choices we have made.
18
1Focus
Our focus is exclusively on the mobile broadband market, a
market that is essential to the future of the telecommunications
industry and in which we have scale, technological leadership,
and a broad installed customer base. With this in mind, we
intend to put our radio, core network and Customer Experience
Management (CEM) products at the forefront of our business.
We will focus our investments in the areas where we either are
today, or have a clear path to become, a market leader. These
areas include radio (3G and 4G including small cells and linking
these to Wi-Fi), core networks, IP Multimedia Subsystems (IMS),
Operations Support Systems (OSS), CEM, and Subscriber Data
Management (SDM).
We will innovate in areas that helps make our portfolio unique,
going above and beyond the standards in order to bring the
greatest possible value to our customers. And, we will leverage
our more mature technologies, such as 2G radio, that still have
demand and give us the opportunity to maintain customer
relationships that will move on to more advanced technologies
at a later date.
Our Global Services organization is designed to ensure that we
deliver and maintain these products, while helping our
customers maximize efficiency and provide a superior
experience to their customers.
2Innovation
3Quality
We have adopted a customer-focused approach to innovation,

which aims to deliver a better return on investment than
traditional standards-based R&D.
In 2011, we took the decision to make quality a strategic priority

and a differentiator for us against our competitors.
Our resources and attention are squarely focused on the real

life challenges faced by operators. An example of how we
innovate together with our customers is the advanced Dense
RAN solution which has the potential to avoid network traffic
overloads at big events.
We also work to drive the evolution of the mobile broadband
ecosystem. We do this through collaboration with publicly
funded projects such as METIS, Comora and SEMAFOUR;
partnership with innovative companies to optimize our R&D
investments and target new market opportunities in areas such
as Telco Cloud and Security; and deep engagement with world
leading research institutes on topics such as big data analytics.
Ultimately, we use insight in from all these areas and more to
provide extremely strong contributions to the development of
industry standards.
The Nokia Siemens Networks-owned portfolio of around 3 800
patent families (comprising 12 000 individual patents and patent
applications) is a testament to our R&D commitment. This
patent portfolio, which is primarily focused on mobile
communications, has resulted in a stream of continuous
technology breakthroughs and industry awards. Consequently,
Nokia Siemens Networks is a significant holder of Intellectual
Property Rights (IPR) and is looking into more ways to make use
of this asset.
To deliver against that goal, we have devoted time, resources,

and significant management attention. Over the course of 2012,
we created dozens of cross-functional, end-to-end quality
teams to drive improvements, deployed more than 15 new best
practices, established an outage reduction forum, expanded
quality training, launched collaborative quality efforts with
multiple customers, and took many other concrete steps.
Those steps delivered significant improvements in 2012,
including a 32% year-on-year reduction in open product
defects, confirmed outages cut by almost one-third, virtual zero
software quality targets on track for a vast majority of business
lines, thousands of employees trained on new quality
techniques, and a meaningful increase in how customers
perceived the value of our products and services.
In 2013 our focus will be on expanding our quality efforts to new
areas, as well as institutionalizing the changes we have already
made so quality becomes permanently embedded in Nokia
Siemens Networks culture.
Annual Report 2012
19
Business review Our strategy and transformation
Transformation
In November 2011, we announced

anewstrategy, including changes
toourorganizational structure and an
extensive restructuring program, aimed
at developing our position as a leader in
mobile broadband and improving our
competitiveness and profitability.
Our restructuring activities required a significant

investment in our business in the form of restructuring
charges of over EUR 1 billion in 2012. These charges
had a significant effect on our profitability for the year
but have enabled us to create a much lower cost
base for the future.
2012 Achievements
20
Business
re-focused
on mobile
broadband
We have invested in the growth mobile broadband technologies such as 4G and, at the
end of 2012, were ranked as the second largest LTE vendor by industry analysts.
We also divested a number of businesses which were not in line with this strategy and
delivered improved Mobile Broadband profitability in the year.
Evolving our
services business
We focused our service offerings on the services that contribute the most to enabling
mobile broadband and that have the most value for our customers. We also chose not to
renew contracts that were not in line with this strategy and at the same time improved our
global delivery model. Combined, these measures have improved our Global Services
operating margins.
Optimized real
estate footprint
During 2012, we enacted a number of planned measures including the transfer of

activities to global delivery centers, consolidation of certain central functions, and
efficiencies in service operations. Together these actions enabled us to dramatically
reduce our real estate requirements by 408 000 square meters; closing 175 sites.
Improved R&D
efficiency
In addition to increasing our investments in the most important technologies we have

increased our overall R&D efficiency. This has been achieved by improvements in quality,
improved processes, a flatter organisation, a better geographical balance and an
increased focus on delivering to immediate customer-specific requirements. This will
remain a priority area in 2013.
Targeting
other costs
We have reduced other costs such as travel expenses dramatically by bringing in new
policies but also by creating awareness of the issue. Other areas addressed included
information technology, product and service procurement costs, overall general and
administrative expenses, and a significant reduction of suppliers to further lower costs
and improve quality.
Improved
working capital
In 2012, we significantly improved our cash position despite restructuring related

outflows. By reducing our overdues and inventories we improved our working capital by
approximately EUR 1 billion over the course of the year. This contributed to positive free
cash flow generation in every quarter.
Getting ready for the future

We, SKT and NSN
have already prepared
for the evolution of the
LTE system.
Jong-Bong Lee Senior Vice President,
Head of Network Strategy Office
Read more about

our work with SK Telecom
inouronline Annual Report
Country: South Korea

Strategic focus:
Differentiation through innovation
Annual Report 2012
21
Business review Industry trends
For a world that wants

more and more
The future of the telecommunications

industry will be increasingly powered by
mobile broadband. Today, of the
6.5*billion global mobile subscriptions,
already 1.65* billion are using mobile
broadband.
Consumers use the internet through a variety of devices and expect
reliable connectivity and access to services everywhere. They also
demand the highest possible standard of excellence from their
mobile operators. Yet, according to our Acquisition and Retention
Study 2012, overall satisfaction is decreasing globally, and 47% of
customers with mobile internet bundles in mature markets are
prepared to switch operators within 12months if they do not get the
experience they demand. The impact of network and service quality
on churn has grown significantly, messaging and internet quality
now being the most important retention criteria in advanced mobile
broadband markets.
Demand for mobile broadband, coupled with the rise of smart
devices, represents the greatest opportunity for revenue growth and
the greatest challenge in terms of network congestion for mobile
operators in the years ahead. However, industry analysts predict that
over the next eight years, the rise in mobile data traffic will accelerate
much faster than operator revenues. Despite increases in network
capacity, data usage offerings such as flat-rate pricing are creating
only a limited revenue opportunity for mobile operators, putting
pressure on their margins. Mobile operators are faced with the
challenge of delivering mobile broadband profitably while
simultaneously providing good quality of service to
their customers.
The market today*
To support the rise in data usage, mobile operators are investing

in wireless infrastructure (like base stations and network software)
for additional coverage and capacity. They are primarily growing
the capacity of their networks by optimizing the networks and
thedifferent radio technologies they use, and upgrading to
latestgeneration wireless networks. These next generation
technologies provide increased bandwidth and capacity,
butrequire mobile operators to invest in new equipment,
infrastructure and software for existing and new base stations.
The growing challenge faced by mobile operators is also the
ability to add intelligence into their network to handle traffic flows
and complex application and quality-of-service requirements.
49% of customers agree that their

mobile operator must offer excellent
network quality, even if it costs
a bit more.
To reduce cost and technology complexity, mobile operators are
simplifying their operations and investing in new, more agile
operations support systems. Some mobile operators are also
outsourcing key network and service management tasks mostly
through long-term partnership agreements.
To improve customer loyalty and profitability, operators are looking
into customer experience management and business analytics
tools, providing insight into their customers service and network
experience.
Mobile operators are also exploring ways to establish a valuable
rolefor themselves in content and capabilities beyond connectivity.
Over-the-top players are actively creating new business models that
can be both opportunities and threats for operators. Responding
tothe challenge, operators are giving increased attention to new
innovative business models and new kinds of service offers
tomonetize their networks and to change the game in
contentdelivery.
1.65 billion
Mobile broadband subscriptions globally
670 million
Smartphones sold in 2012
More than
55 million
Apps downloaded every day
22
* Source: Informa.
Source: Nokia Siemens Networks Acquisition

and Retention study 2012.
Our technology vision 2020

We at Nokia Siemens Networks believe that, by 2020, mobile
networks will need to be ready to deliver one gigabyte per user per
day, downloaded at speeds of more than 10 times the current level.
One gigabyte per day equates to a 60-fold increase, or roughly a
doubling of traffic per user every 18 months, compared to the
average 500 megabytes per user per month some mobile
networks in mature markets are seeing today. As demand moves
towards onegigabyte per day, operators need to get the most out
of their network resources, shift capacity and content where these
are most needed, and provide a superior customer experience for
a steadily growing mobile broadband customer base. To make this
happen, Nokia Siemens Networks is exploring and developing vital
capabilities and technologies in the following areas:
Key area
1 GB of personalized
data per user per day
profitably by 2020.
How we are developing our capabilities

Supporting up to
1 000x more capacity
where needed
To prepare for future traffic growth and 10 times more endpoints attached to networks
than today, the capacity and data rates of mobile networks must be radically pushed into
new dimensions by looking at ways to increase the amount of spectrum available, and at
how to make the most efficient use of that, and also by increasing the number of sites.
Reducing latency to
milliseconds
To support a good user-experience for the increasing number of real-time apps,

end-to-end latency imposed by the network has to be significantly reduced.
Bandwidth,traffic control and proximity will solve the latency challenge.
Teaching networks to
be self-aware
To ensure mobile broadband remains affordable, the network Total Cost of Ownership
(TCO) per gigabyte of traffic needs to be radically decreased. One important lever is to
automate all tasks of network and service operations by making networks intelligent:
self-aware, self-adapting and agile.
Reinventing the telcos To further reduce cost per gigabyte, the utilization of all network resources through
for cloud
sharing in all dimensions must be maximized. Cloudification of telco networks and
ultimately software defined networking is the way forward, as it will also make networks
more agile while opening up new business opportunities for operators.
Flattening energy
consumption
To achieve the lowest production cost level per gigabyte, the energy efficiency of
networks needs to be increased. The focal point for improving network energy efficiency
will be the radio access, which accounts for around 80% of all mobile network energy
consumption. Apart from energy efficiency innovations in the base station, network
modernization and higher utilization through sharing of resources will be key for
flatteningenergy consumption.
Annual Report 2012
23
Business review How we operate
Focus in action: business units
We have modified our structure to align

with our strategy to focus exclusively on
mobile broadband, and now report across
two business units: Mobile Broadband and
Global Services.
Business units
The Mobile Broadband business unit provides radio and core
network software, network hardware as well as the underlying
Operations Support Systems (OSS) and Customer Experience
Management (CEM) software to mobile operators serving billions
ofmobile subscribers across the globe.
The mobile operator customers of the Mobile Broadband unit are
supported by the Global Services unit, providing them with a broad
range of services, including network planning and optimization,
network implementation, managed services for network and
serviceoperations, and care and maintenance services.
Consistent with our strategy, in 2011 we identified certain product
lines that have either been divested or are being managed for value.
For these, we support existing customer contracts and customer
commitments including currently contracted feature capabilities,
aswell as limited new feature developments.
Mobile Broadband
Our Mobile Broadband product portfolio includes our innovative
and award-winning Flexi Multiradio Single RAN base station, a
high capacity software-defined base station supporting 2G
(GSM), 3G (WCDMA) and 4G (LTE) radio technologies, as well
aspacket core products. To date, we have three million base
stations in service, with a customer list that includes Amrica
Mvil, China Mobile, Deutsche Telekom, SoftBank, Telefnica,
T-Mobile USA, Verizon and Vodafone.
Our Mobile Broadband portfolio also incorporates value-adding
software products including OSS and Subscriber Data
Management (SDM), as well as CEM. These products give
mobileoperators a comprehensive and real-time insight into
theircustomers service experience, and the tools that help
themdrive new revenue and improve operational efficiency.
Throughout 2012, the Mobile Broadband business unit has further
developed business in advanced markets and continues to
perform well, delivering strong growth in 4G sales and a sustained
2G and 3G business, particularly in the USA, South Korea, Japan
and Latin America, as well as in many other countries around
theworld. At December 31, 2012, Nokia Siemens Networks
hadatotal of 77 commercial 4G (LTE) deals, including major
agreements modernizing network infrastructure with both
SoftBank and KDDI in Japan, and T-Mobile in the USA.
For the year ended December 31, 2012, Mobile Broadband
generated net sales of EUR 6 043 million, which represented
45%of our total net sales, and non-IFRS operating profit of
EUR488 million.
To maximize the value for our customers, we are able to combine
different radio technologies together seamlessly, incorporate
small cells which increase the capacity of the networks, provide
and integrate Wi-Fi and we have unique software which increases
the utilization of all available spectrum and increases the amount
of data which it can carry.
Within Mobile Broadband, we are already working on
enhancements as well as the next generation of technology, even
as the latest 4G networks are being rolled out across the world.
6
043 million
Net sales generated by Mobile Broadband
45%
Of our total net sales
3
million
Base stations delivered
to over 450 mobile operators
24
Global Services
Our Global Services business comprises three business lines,
each closely supporting the Mobile Broadband portfolio:
Customer Care includes software and hardware maintenance,
and competence development services
Network Implementation includes services needed to build,
expand or modernize a communications network efficiently.
Onaverage, over 330 000 sites are installed per year, over 40%
ofwhich are implemented remotely, in 2012 we brought one site
on air every 96 seconds.
Professional Services provide the end-to-end capability to deliver
and manage mobile broadband infrastructure and customer
experience. Our system integration capabilities ensure that all the
elements of a new mobile broadband solution seamlessly bring
together new and legacy technologies. Network Planning and
Optimization teams offer assessment, capacity and configuration
planning, site count, and IP design. Within our Managed Services
business we take the responsibility for running a range of services
for operators, from network operations management to enabling
them to offer new services to their customers.
Non-core
During 2012, our Non-core business unit included WiMAX,
Broadband Access and IPTV, which were divested during the year.
By the year-end, the only business that remained in the Non-core
business unit was Business Support Systems (BSS), which we plan
to divest in the first half of 2013.
For the year ended December 31, 2012, Non-core generated net
sales of EUR 365 million representing 3% of total net sales and a
non-IFRS operating loss of EUR 33 million.
Discontinued operations
Towards the end of 2012, Nokia Siemens Networks announced
itsintention to divest its Optical Networks business. As Optical
Networks represented a separate business segment in the past,
itispresented as a discontinued operation. The transaction is
expected to close in the first half of 2013.
Over the course of 2012, a growing percentage of our global

services began to be delivered through our network of delivery
centers, which consolidate a range of service solutions into one
location to provide greater efficiency for customers. At the end of
2012, 21% of services were provided from our global delivery hubs.
For the year ended December 31, 2012, Global Services generated
net sales of EUR 6 929 million, which represented 52% of our total
net sales, and non-IFRS operating profit of EUR 332 million.
6
929 million
Net sales generated by Global Services
52%
Of our total net sales
77
To see more on our segment

information please
see p77.
Annual Report 2012
25
Business review Where we operate
Focus in action: markets
In 2012, Nokia Siemens Networks

countryoperations were grouped
intobroad geographical groups:
theAmericas; Asia and Middle East;
and Europe and Africa.
Americas
These three markets further divide into regions containing

oursalesand delivery teams which benefit from a very close
relationshipwith mobile operators in their countries. We tailor
ouroperating approach in the different regions and countries
accordingto the macro-economic environment and the
maturityoftheir telecommunications industry.
The Americas comprises operations in the USA and Canada in

North America, and 11 countries in Latin America.
Teams across the region work with eight of the top 10 North
American mobile operators, as well as local operators, key cable
andconvergence companies, and government entities. We also
have the Innovation Lab, our flagship mobile broadband testing and
development facility, in the heart of Silicon Valley. The North America
region was our fastest growing region in 2012 and delivered strong
net sales during the latter part of 2012 both in products and services.
In Latin America we see the opportunity for emerging economies
toleap-frog a traditional 2G 3G 4G development pattern and
invest in the most modern technologies. Smartphones and tablets
are already transforming the face of the Latin American markets.
TheLatin America region delivered a solid financial performance
over the course of the year.
Latin America will be part of our Europe market in 2013.
Net sales by geographic area (EURm)
Key highlights
Selected as a vendor to support T-Mobile USAs $4 billion 4G
network evolution plan, modernizing the operators GSM and
HSPA+ core and radio access infrastructure and deploying LTE
33%
21%
Europe
and Africa
4 378m
Americas
2 849m
Establishing our global small cell center of excellence in the USA

to drive small cell innovation with leading operators from around
the world
Launching wireless broadband services using 4G technology
for SKY, the largest cable and satellite television operator in
Brazil
Launching LTE with Claro in Chile, the first 4G in this key and
well-developed economy in Latin America
Asia and
Middle East
6 145m
Being selected by Oi and TIM for 4G roll-out in Brazil; secured

3G expansion with Oi and Claro across the country
46%
26
Asia and
Middle East
Europe
andAfrica
Asia and Middle East spans a huge geographical and economic

scope consisting of operations in 17 countries in Asia and 16
countries in the Middle East.
We operate in 52 countries across Europe, Russia and a further 20

countries inAfrica.
We have a strong presence across Asia, from mature markets to

fast-emerging economies, including two of our focus countries,
Japan and South Korea. We have close relationships with all the
major operators, including SoftBank, KDDI, SK Telecom, China
Mobile, China Unicom, Bharti Airtel, Optus, Vodafone and Indosat.
The region delivered an outstanding year in 2012, with several key
contracts, particularly in our focus countries, and excellent financial
performance. We have technology centers in multiple locations in
Asia, with our flagship mobile broadband center in Hangzhou,
China,and our largest software center in Bangalore, India.
In the Middle East we are focused on a select number of countries
and customers, including Qtel Group, Zain Group, Saudi Telecom
Company, Etisalat anddu, and we see strong demand for mobile
broadband including 4G (LTE).
The European region, including Russia and some central Asia

countries, is our heartland and home to our headquarters in Finland
and to our global delivery center in Portugal. In Europe, we work with
all the regions major operators, including Vodafone, Deutsche
Telekom, Telefnica, France Telecom, Sistema, MegaFon,
TeliaSonera and WIND, serving hundreds of millions of demanding
and sophisticated customers. Facing challenging macro-economic
conditions across the European continent, we nevertheless
maintained strong customer relationships throughout the region and
achieved some notable wins. We have extensive R&D expertise in
Europe, including some of our largest technology centers working
on future mobile broadband technologies.
In Africa, we are focused on both multi-national and regional
operators, including Zain Group, Vodacom, Bharti Airtel and Mobinil.
Africa will be part of our Asia and Middle East market in 2013.
Key highlights
Key highlights
Working with SoftBank to upgrade its mobile broadband

capability across Japan and to supply, deploy and integrate the
operators 4G network
Working with leading Polish operator, Polkomtel, to expand their

HSPA+ and 4G (LTE) networks
Deploying the worlds first self-operating 3G and 4G mobile

network for KDDI in Japan
Supporting leading Australian operator Optus in network
modernization and 4G implementation
Telkomsel Indonesia takes control of customers experience
with Nokia Siemens Networks technology
KT selects Nokia Siemens Networks for 4G deployment
Supporting Bharti Airtel to deploy and manage 4G (TD-LTE)
network in Maharashtra
Chosen by Indosat, Indonesias leading mobile operator, as its
mobile broadband vendor
Selection by China Mobile to conduct a large 4G (TD-LTE)
deployment across three cities
Bringing 4G (TD-LTE) to Spain in a deal with COTA a new

player in Spanish telecoms
Preparing O2s network in the UK for 4G
Launching Russias first 4G (TD-LTE) network, for MTS in
Moscow and the citys environs
Implementing a GSM-R upgrade to enhance security and
speed on the Eskisehir-Ankara high-speed train line in Turkey
Working with Tele2 to enhance mobile broadband across three
Baltic countries
Enabling MegaFon customers to enjoy enhanced mobile
services in Russia
Working with Vodacom to introduce voice and SMS over 4G
in South Africa
Upgrading Saudi Telecom Companys GSM and 3G networks

and expanding its 4G network
Annual Report 2012
27
The worlds rst multi-vendor, multitechnology self-organizing network (SON)

As a leader in SON technology,
was the obvious choiceto
help consolidate and optimize
our networks.
Toshihiko Yumoto, Vice President
and General Manager, Network Technical
Development Division, Technology Sector, KDDI
Read more about

our work with KDDI
inouronline Annual Report
Country: Japan
Strategic focus area:
Customer Satisfaction by realizing
3M strategy Multi-Network,
Multi-Device and Multi-Use
28
Business review Operating and Financial Review
A year of transformation and restructuring
Overview
For a summary description of who we are and what we do see
page 4. A review of our principal activities and performance for the
year is contained in the 2012 highlights on pages 6 and 7, A letter
from our Chairman on page 8, the Chief Executive Ofcers strategic
review on pages 12 to 15, Our strategy and transformation on pages
18 to 20, How we operate and Where we operate on pages 24 to 27.
Principal factors and trends affecting our results
ofoperations
Our net sales depend on various developments in the global mobile
broadband infrastructure and related services market, such as
network operator investments, the pricing environment and product
and services mix.
Over recent years, the telecommunications infrastructure industry
has entered a more mature phase characterized by the completion
of the greeneld roll-outs of mobile and xed network infrastructure
across many markets, although this is further advanced in
developed markets. Notwithstanding, there is still a signicant
market for traditional network infrastructure products to meet
coverage and capacity requirements, as older technologies such as
2G are supplanted by 3G and 4G (LTE). As growth in traditional
network products sales slows, there is an emphasis on the provision
of network upgrades, often through software, such as customer
experience management software and subscriber management,
and services, particularly the outsourcing of non-core activities to
companies that provide extensive telecommunications expertise
and strong managed service offerings.
In emerging markets, the principal factors inuencing investments by
mobile operators are the continued growth in customer demand for
telecommunications services, including data, as well as new
subscriber growth. In many emerging markets, this growth in
demand and subscribers continues to drive growth in network
coverage and capacity requirements.
In developed markets, investments by operators are primarily driven
by capacity and coverage upgrades, which, in turn, are driven by
greater usage of the networks primarily through the rapid growth in
data usage. Increasingly, mobile operators are targeting investments
in technology and services that allow them to provide their
customers with fast and faultless network performance in the most
efcient manner possible, which optimizes their investment. Such
developments are facilitated by the evolution of network
technologies that promote greater efciency and exibility, such as
the current shift from 2G and 3G networks to 4G (LTE) technologies.
In addition, mobile operators are investing in software and services
that provide them with the means to better manage customers on
their network and also allow them additional access to the value of
the large amounts of subscriber data under their control. The
telecommunications infrastructure market is characterized by strong
competition and price erosion caused in part by the successful entry
into the market of vendors from China, such as Huawei Technologies
Co. Ltd. (Huawei) and ZTE Corporation (ZTE), both of which have
gained market share by leveraging their low cost advantage in
tenders for customer contracts. In particular, the wave of network
modernization that has taken place, particularly in Europe but
increasingly in other regions including Asia Pacic, has led to
aggressive pricing as all vendors ght for market share. In 2012, we
witnessed further competition emerging from Samsung Electronics,
which has expanded its network infrastructure business out of the
South Korean market with limited gains in Europe and the USA. The
pricing environment remained challenging in 2012.
Our net sales are impacted by these pricing developments, which
show some regional variation, and in particular by the balance
between sales in developed and emerging markets. While price
erosion is evident across most geographical markets, it continues to
be particularly intense in a number of emerging markets where many
mobile operators have been subject to nancial pressure, both from
lack of nancing as well as profound pricing pressure in their
domestic markets.
Pricing pressure is evident in the standards-based products
markets, in particular, where competitors have products with similar
technological capabilities, leading to commoditization in some
areas. Our ability to compete in those markets is determined by our
ability to remain price competitive with our industry peers. To remain
competitive and differentiate us from our competitors, it is therefore
essential that we constantly improve our technology while
continuously reducing product costs to keep pace with price
erosion. We have continued to make progress in reducing product
and procurement costs in 2012 and will need to continue to do so in
order to provide our mobile operator customers with high quality
products at competitive prices.
In the following sections we describe the factors and trends that we
believe are currently driving our net sales and protability. For a
better understanding of the industry trends in terms of mobility and
data usage please see pages 22 and 23.
Transformation and restructuring program
In November 2011, we announced a strategic shift to focus on the
mobile broadband market. As part of this strategic shift, we decided
to focus our portfolio on our core businesses and sell or ramp down
non-core activities. At the same time, we started a restructuring
program to reduce our global workforce by 17 000 people by the
end of 2013. These reductions are being driven by aligning our
workforce with our new strategy as well as through a range of
productivity and efciency measures. These measures include
elimination of our matrix organizational structure, site consolidation,
transfer of activities to global delivery centers, consolidation of
certain central functions, cost synergies from the integration of the
Acquired Motorola Assets, efciencies in service operations and
company-wide process simplication. Overall the transformation
and restructuring have had a substantial effect on both gross
margins and operating expenses.
Annual Report 2012
29
Business review Operating and Financial Review continued
Gross margin before specic items

Our gross margin before specic items improved substantially in the
three-month periods ended September 30, 2012 and December 31,
2012 to 32.4% and 36.0%, respectively, as compared to 26.9% and
29.5% in the corresponding periods of 2011. This improvement was
driven principally by sales of a signicant proportion of higher margin
software and products in our priority markets.
Signicant contributors to the reduction in operating expenses

before specic items include:
Other signicant contributors to the improvement in gross margin

include:
We have established strong processes and governance

procedures to reduce indirect costs such as travel, training and
external services.
We improved our pricing discipline to ensure that we were

capturing the appropriate value for our products and services.
Weare pricing our products based on their value to the mobile
operators rather than based on our costs in delivering the
contract. All major contracts now pass through specialist
pricingteams.
Our more focused portfolio has led to a decrease in our cost of
goods as we have fewer product lines and are adhering to a much
higher quality benchmark, which has resulted in fewer returns.
We have improved the operational efciency of our supply chain,
decreasing logistics costs and improving delivery reliability.
Ourincreased operational efciency has resulted, for example,
ina signicant reduction in the need for expensive air freight
andthe lowest levels of supply shortages in Nokia Siemens
Networks history.
We increased the proportion of sales in markets with above
average gross margins, such as Japan.
Operating expenses before specic items
We have reduced our operating expenses before specic items by
11.8% and 7.7% in the three-month periods ended September 30,
2012 and December 31, 2012, respectively, as compared to the
same periods in 2011. This has been driven mainly by reductions in
headcount which at 58 411, as of December 31, 2012 was at its
lowest level since our formation in 2007.
30
We have closed and vacated 175 real estate sites, optimized site
usage and relocated to less costly premises. We have reduced
our total space by 408 000 square meters, and further space
reductions are expected in 2013 as leases come up for renewal.
Despite increasing Research and Development (R&D) investment

in strategic areas such as 4G (LTE) radio technologies, we have
maintained the overall spend by decreasing investment in
previous generation radio technologies and non-core portfolio
areas. A focus on higher quality products and divestments of
non-core businesses has also resulted in a more efcient use of
our R&D expenses.
We continue to target a reduction in our annualized operating
expenses and production overheads, excluding specic items by
more than EUR 1 billion by the end of 2013, compared to the end
of2011. While these savings are expected to come largely from
organizational streamlining, we have also targeted areas such as real
estate, information technology, product and service procurement
costs, overall general and administrative expenses and a signicant
reduction of suppliers in order to further lower costs and improve
quality. During 2012, we recognized restructuring charges and
otherassociated items of EUR 1.3 billion related to our ongoing
restructuring program. By the end of 2012, we had cumulative
cashoutows relating to restructuring and other specic items
ofEUR 645 million. We expect restructuring-related cash outows
tobe approximately EUR 450 million for the full year 2013, and
approximately EUR 200 million for the full year 2014 related to
ourtransformation and restructuring program.
The following table sets forth the summary unaudited, condensed,
consolidated quarterly nancial information for each of the quarters
in the years ended December 31, 2011 and 2012 from continuing
operations. This data has been derived from our unaudited quarterly
nancial information, which are not included in this Annual Report,
and should be read in conjunction with our Consolidated Financial
Statements and the related notes.
For the three month period ended (unaudited)

From continuing operations
EURm, except percentage data
Net sales
Gross prot
Gross margin
Specic items therein
Adjusted gross prot1
Adjusted gross margin1
Operating expenses
Specic items therein
Adjusted operating expenses2
Operating prot/loss (EBIT)
Adjusted EBIT3
Depreciation and amortization
(excluding PPA)
Adjusted EBITDA4
Adjusted EBITDA margin4
Restructuring
PPA related amortization
Other PPA related charges
Country/contract exit and
merger-related charges
Other one-time charges
Total specic items
Working capital5,8
Change in net working capital6,8
Free cash ow7,8
March 31,
2011
June 30,
2011
September 30, December 31,

2011
2011
March 31,
2012
June 30,
2012
September 30, December 31,

2012
2012
3 084
826
26.8%
7
833
27.0%
(942)
141
(801)
(116)
32
3 524
910
25.8%
26
936
26.6%
(1 007)
131
(876)
(97)
60
3 327
876
26.3%
20
896
26.9%
(971)
105
(866)
(95)
30
3 710
1 096
29.5%
(2)
1 094
29.5%
(997)
116
(881)
99
213
2 862
414
14.5%
348
762
26.6%
(1 403)
515
(888)
(989)
(126)
3 233
780
24.1%
68
848
26.2%
(1 006)
185
(821)
(226)
27
3 408
1 064
31.2%
41
1 105
32.4%
(845)
81
(764)
219
341
3 869
1 197
30.9%
196
1 393
36.0%
(942)
129
(813)
255
580
73
105
3.4%
14
120
75
135
3.8%
57
84
5
80
110
3.3%
17
91
8
78
291
7.9%
16
91
76
(50)
(1.7)%
748
91
8
68
95
2.9%
95
71
(4)
67
408
12.0%
22
71
61
641
16.6%
191
71
14
148
2 370
(111)
(158)
11
157
1 527
(243)
(923)
125
2 277
49
(30)
114
2 311
321
446
16
863
1 384
554
291
70
21
253
1 145
94
61
3
26
122
1 144
82
282
34
29
325
1 999
255
733
References to Adjusted gross prot and Adjusted gross margin are to gross prot and gross margin as adjusted for specic items. Specic items include restructuring
charges, country/contract exit and merger-related charges, PPA related charges and other one-time charges.
2
References to Adjusted operating expenses are to operating expenses as adjusted for specic items.
3
References to Adjusted EBIT are to EBIT as adjusted for specic items.
4
References to EBITDA are to loss for the period before income tax expense from continuing operations, nancial income and expenses, depreciation, amortization and
share of results of associates. Accordingly, EBITDA can be extracted from the Consolidated Financial Statements by taking loss for the period and adding back income tax
expense, nancial income and expenses, depreciation, amortization and share of results of associates. References to Adjusted EBITDA represent EBITDA as adjusted for
specic items. Specic items include restructuring charges, country/contract exit charges, PPA related charges and other one-time charges. References to Adjusted
EBITDA margin represent Adjusted EBITDA divided by net sales.
We are not presenting EBITDA or Adjusted EBITDA-based measures as measures of our results of operations. EBITDA and Adjusted EBITDA-based measures have
important limitations as an analytical tool, and they should not be considered in isolation or as substitutes for analysis of our results of operations.
5
Working capital is dened as current assets less current liabilities.
6
Change in net working capital is dened as the period-over-period change in current receivables plus the change in inventories, less the change in interest-free short-term
liabilities.
7
Free cash ow is dened as the sum of net cash ows from operating activities and net cash ows from investing activities.
8
Working capital, change in net working capital and free cash ows include continuing and discontinued operations.
Annual Report 2012
31
Motorola Solutions acquisition

Assets acquired from Motorola Solutions (the Acquired Motorola
Assets) contributed eight months of sales in the year ended
December 31, 2011, which impacts the comparability of our results
ofoperations for all periods presented. The delay to the completion of
the acquisition caused a negative impact on business in the CDMA
and WiMAX units (the latter of which has been divested). As part of our
transformation restructuring program, we restructured the Acquired
Motorola Assets. The acquisition has given us a global footprint in
CDMA. The recent network infrastructure investment activity evident
in the USA market and elsewhere, however, is beginning to slow,
which has had a negative impact on sales in the CDMA unit. The
acquisition has also strengthened our relationships with customers
globally, particularly in Japan and the USA. From the date of
acquisition on April 30, 2011, we had net sales of EUR 894 million
contributed by, and a net loss of EUR 4 million in respect of the
Acquired Motorola Assets for the year ended December 31, 2011.
After the incurrence of EUR 39 million related to restructuring charges
and EUR 48 million related to the amortization of acquired intangible
assets and other purchase price accounting related charges, we had
a net loss of EUR 4 million.
Disposals not treated as discontinued operations
As part of our strategy to focus on our Mobile Broadband business
and on our higher margin businesses, we continually assess
whether our operating companies are core to our overall business
strategy or performing at acceptable levels. As a result, we may sell a
business if it is deemed to be non-essential or underperforming.
Such disposals may affect our results of operations and the
period-to-period comparability of our nancial statements.
In the ordinary course of business, we may sell other parts of our
business and not treat them as discontinued operations (and are
therefore included in continuing operations) for the periods under
review as the businesses sold are not considered to represent a
separate major line of business or geographical area of our
operations.
In connection with the strategy, seven divestments were announced
in 2012 and ve of these deals were closed in the course of the year.
The divestments concluded during 2012 were:
A deal to transfer the microwave transport business, including its
associated operational support systems and related support
functions, to Dragonwave Inc.
The sale of former Motorola Solutions WiMAX business to
NewNet Communications Technologies.
The divestment of xed line broadband access business and
associated professional services and network management
solutions to Adtran.
32
The sale of Belgacom-related IPTV assets to Belgacom and other

IPTV assets to Accenture.
A deal to transfer the Nokia Siemens Networks proprietary
broadband business, Expedience, to CN Tetragen.
In 2012, the total net consideration paid in connection with these
disposals amounted to EUR 124 million in cash. Additionally, shares
with fair market value of EUR 5 million were received. A loss, net of
gains, of EUR 50 million arising from the sale of these businesses is
included in other expenses in the consolidated income statement.
On December 5, 2012, we signed a formal agreement with Redknee
Solutions Inc., for the sale of our Business Support Systems Business,
comprising the billing and charging software products and solutions
and related services (together, the BSS Business). The transaction is
anticipated to close in the rst half of 2013. The assets and liabilities of
the BSS Business were classied as held for sale in the consolidated
statement of nancial position at December 31, 2012.
In 2011, impairment charges totaled EUR 19 million and these
charges were recognized as a result of measuring these disposal
groups at their fair value, less costs to sell. Certain of these
transactions included contractual provisions that required cash
payment on closing to the buyer and possible additional payments
subsequent to the sale which will be made based on potential
employee redundancies within the disposal group. These
dispositions in 2011 were not classied as discontinued operations.
Certain other factors
Cost of components and raw materials
There are several factors that drive our protability. Scale, operational
efciency and cost control have been and will continue to be important
factors affecting our protability and competitiveness. Our product
costs are comprised of the cost of components, manufacturing, labor
and overhead, the depreciation of product machinery, logistics costs
as well as warranty and other quality costs. In the year ended
December 31, 2012, components and other raw materials comprise
approximately 85% of our cost of goods sold.
Overall since 2010 we have reduced component costs as a result of
annual purchase price negotiations. During that period we have also
experienced some wage ination, particularly in China, where the
rising cost of prices for goods such as food has driven inationary
pressure in salaries. Similar pressures are evident in India, although
from lower income levels.
Product mix and regional mix

Our protability is also impacted by the pricing environment, product
mix, including higher margin software sales, and regional mix. Our
products, solutions and services, have varying protability proles. Our
Mobile Broadband business offers a combination of hardware and
software. These products, in particular software products, have higher
gross margins; however, the products require much higher R&D
investments. Our Global Services offerings are typically labor intensive
while carrying low R&D cost and have relatively low gross margins
compared to our hardware and software products. Many of our
product service offerings combine elements from all business units,
and several factors can inuence relative gross margin. In the year
ended December 31, 2012, Global Services and Mobile Broadband
accounted for 51.8% and 45.2%, respectively, of our total net sales in
the year ended December 31, 2012.
In the second half of 2012, we beneted from sales of an unusually
large proportion of higher margin software and products in our
priority markets. We have also beneted from being more selective
about the services contracts we enter into and reducing our
exposure to lower protability areas such as eld maintenance.
Overall protability for certain regions should only be seen as
indicative, as protability can vary from country to country, within a
particular region and even from customer to customer within a
particular country. During 2011 and 2012, we have pursued a policy
of prioritizing markets such as Japan, South Korea and the USA, as
these markets typically offer vendors more value than other markets.
In general, developed markets provide relatively high margins while
emerging markets, where mobile operators customers, and
therefore mobile operators, are often more nancially constrained,
provide lower margins.
Regulatory issues
We sell products and services that are regarded as sensitive from a
security point of view by many governments around the world and
therefore conform to certain regulations which are subject to
change, which can occasionally cause disruption to sales. An
extreme example of this was evident in the rst half of 2011 when
changes to Indian security clearance regulations caused signicant
disruption to sales of products. We work closely with authorities to
understand concerns and to minimize the impact of such issues.
Exchange rates
Our business and results of operations are from time to time affected
by changes in exchange rates, particularly between the euro, our
reporting currency, and other currencies such as the US dollar and
the Japanese yen. Foreign currency denominated assets and
liabilities, together with sale and purchase commitments, give rise to
foreign exchange exposure.
The magnitude of foreign exchange exposure changes over time as
a function of our presence in different markets and the prevalent
currencies used for transactions in those markets. The majority of
our non euro-based sales are denominated in US dollars and in
Japanese yen. In general, depreciation of another currency relative
to the euro has an adverse effect on our sales and operating prot,
while appreciation of another currency relative to the euro has a
positive effect. In addition to foreign exchange risk of our sales and
costs, our overall risk depends on the competitive environment in our
industry and the foreign exchange exposures of our competitors.
During 2012, both the US dollar and the Japanese yen were relatively
volatile against the euro. During the rst half of 2012, both the US
dollar and the Japanese yen appreciated against the euro, but
subsequently depreciated. By the end of the year 2012, both
currencies had depreciated against the euro compared to the rate at
the beginning of the year.
In the year ended December 31, 2012, approximately 43%
(approximately 36% in 2011) of our net sales were generated in US
dollars and Japanese yen. During the same period, approximately
32% (approximately 28% in 2011) of our cost base was in US dollars
and in Japanese yen. Due to our currency mix, a depreciation of US
dollar and Japanese yen had an adverse effect on our sales and
operating prot. The majority of the impact of the US dollar and
Japanese yen depreciation or appreciation against the euro on our
operating results is however mitigated through currency hedging.
Signicant changes in exchange rates may however impact our
competitive position and result in price pressure through their impact
on our competitors and customers.
Overall hedging costs for the main exposure currencies have
remained relatively low in 2011 and 2012 due to the low interest rate
environment.
Annual Report 2012
33
To mitigate the impact of changes in exchange rates, we hedge

material transaction exposures. For the majority of the hedges for
forecasted future transactions, hedge accounting is applied to
reduce prot and loss volatility. The main principle is that all major
foreign exchange exposures are identied, analyzed and hedged by
our treasury function. Specically:
Statement of nancial position risks from foreign exchange
positions in currencies other than the functional currency of the
respective Group entity are identied and hedged on an ongoing
basis.
Cash ow risks arising from highly probable forecasted sales and
purchases of the Group are identied on a monthly basis and
hedged mainly under hedge accounting for a period of up to 15
months. These forecasted sales and purchases are typically
realized within an equivalent period.
We have some exposure due to unhedged risks which consists of
exposures in currencies that either cannot be hedged or which are
considered immaterial. In 2012, these currencies represent
approximately 2% of our net sales (less than 2% of net sales in 2011).
We have entities in Venezuela and Belarus where the functional
currency is the currency of a hyperinationary economy.
Hyperinationary accounting did not have a material impact on the
statement of nancial position in 2012 or 2011. Trading in
hyperinationary economies carries a risk of future devaluation of
monetary assets and liabilities. This risk cannot be hedged.
We have foreign exchange exposure in Iran that cannot be hedged.
Iran does not have a hyperinationary economy but it is impacted by
international sanctions, foreign currency access is limited, and
several exchange rates are available. We recognized a foreign
exchange loss of EUR 109 million due to the depreciation of the
Iranian rial in 2012.
Seasonality
Our net sales are affected by seasonality. Historically, net sales in the
rst quarter of the year have been the lowest and net sales in the
fourth quarter of the year have been the strongest. Our net sales
uctuate with our mobile operators planning, budgeting and
spending cycle. For example, our net sales in the rst quarter of 2012
were EUR 2 862 million compared with EUR 3 869 million in the
fourth quarter of 2012, and our net sales in the rst quarter of 2011
were EUR 3 084 million compared with net sales in the fourth quarter
of 2011 of EUR 3 710 million.
34
Disposals treated as discontinued operations

On December 1, 2012, we reached a formal agreement with Marlin
Equity Partners, for the sale of our Optical Networks Business
comprising the complete Optical Networks product portfolio,
services offering and existing customer contracts (together, the
Optical Networks Business). Completion of the transaction is
anticipated during the rst half of 2013 and, according to
managements fees estimates, a loss of at least EUR 130 million is
expected to be recognized following the de-recognition of assets
and liabilities to be transferred.
In accordance with IFRS, we have presented the Optical Networks
Business as discontinued operations in the consolidated nancial
statements for the year ended December 31, 2012, and have
re-presented the comparative results for years ended December 31,
2011 and 2010 included in those statements.
Segment information
Our results of operations include certain nancial information by
product segment. We report across two business units: Mobile
Broadband and Global Services. Other major lines of business
previously were our Optical Networks and Non-core business units.
AtDecember 31, 2012, Optical Networks was classied as a disposal
group held for sale and, as it has represented a separate major
business line in the past, is presented as discontinued operations.
Assuch, it has been excluded from the segment reporting.
During 2012, our Non-core business unit included the microwave
transport business, WiMAX, broadband access, IPTV and
Expedience, which were divested during the year, and BSS. By
year-end, the only business that remained in our Non-core business
unit was BSS, which will be divested in the rst half of 2013. We have
aggregated the results of these separate businesses for reporting
purposes, under All other segments, as they did not represent
separate reportable business segments.
We assess the performance of the operating segments based on a
measure of operating prot that excludes certain items, referred to
as specic items (for an analysis of specic items, please see Note 2
to our Consolidated Financial Statements). The costs of central
functions and our worldwide sales and marketing organization have
been allocated to the segments based on the utilization of the
respective resources. Taxes, interest income and expenses are not
allocated to the segments. There are no transactions between the
segments.
The segment revenue is measured largely in a manner consistent
with revenue as reported in the consolidated income statement.
Group level adjustments related to customer projects accounted for
under the percentage of completion accounting method have been
allocated to the segments.
Results of operations
Year ended December 31, 2012 compared to year ended December 31, 2011
Our operating results for the year ended December 31, 2011 include eight months of the results of the Acquired Motorola Assets. Accordingly,
our results for that period are not directly comparable to our results for the year ended December 31, 2012.
The following table sets forth selective line items from our consolidated income statement and the percentage of net sales that they represent
for Nokia Siemens Networks for the year ended December 31, 2012 and 2011.
For the year ended December 31

2011
2012
Percentage
of net
sales
Before
specic
items
Specic
items
13 645
(9 886)
(51)
Before
specic
items
Net sales
Cost of sales
13 372
(9 264)
(653)
13 372 100.0%
(9 917) 74.2%
Gross prot
R&D expenses
Selling and marketing expenses
Administrative and general expenses
Other income and expenses, net
4 108
(1 908)
(885)
(453)
(40)
(653)
(208)
(382)
(242)
(78)
3 455
(2 116)
(1 267)
(695)
(118)
25.8%
15.8%
9.5%
5.2%
0.9%
3 759
(1 969)
(990)
(497)
32
(51)
(107)
(330)
(37)
(19)
3 708
(2 076)
(1 320)
(534)
13
822
(1 563)
(741)
8
5.5%
335
(544)
(209)
(17)
Income statement information:
Operating prot/(loss)
Share of results of associates
Financial income and expenses, net and other
nancial results
Specic
items
Total
Total
Percentage
of net
sales
13 645 100.0%
(9 937) 72.8%
(307)
(151)
Loss before tax

Income tax/(expense)
(1 040)
(342)
(377)
(234)
Loss for the year from continuing operations
(1 382)
(611)
(%)
change
(2.0)%
(0.2)%
27.2%
(6.8)%
15.2%
1.9%
9.7%
(4.0)%
3.9%
30.1%
0.1% 1 007.7%
1.5%
254.5%
The following table sets forth Nokia Siemens Networks net sales for the years ended December 31, 2012 and 2011 by segment and
geographic area based on customer location.
Nokia Siemens Networks selected segment data
Mobile
Broadband
Global
Services
All other
segments1
2012
Net sales
Operating prot/(loss) before specic items
Operating prot/(loss) % before specic items
6 043
488
8.1%
6 929
332
4.8%
365
(33)
(9.0)%
2011
Net sales
6 335
214
3.4%
6 737
229
3.4%
573
(108)
18.8%
Other
Total
35
35
13 372
822
6.1%
13 645
335
2.5%
All other segments represent the aggregated results of several businesses that were divested or that were planned to be divested during 2012, with such divestment
expected to be completed during the rst half of 2013.
Annual Report 2012
35
Nokia Siemens Networks net sales by geographic area

For the year ended
December 31
2012
(audited)
2011
(audited)
(%) change
(unaudited)
North East Europe

West Europe
South East Europe
Africa
891
1 900
1 039
548
1 107
2 032
1 257
579
(19.5)%
(6.5)%
(17.3)%
(5.4)%
Europe and Africa
4 378
4 975
(12.0)%
Middle East
Greater China
Japan
India
APAC
687
1 278
2 173
737
1 270
817
1 457
1 533
911
1 176
(15.9)%
(12.3)%
41.7%
(19.1)%
8.0%
Asia and Middle East
6 145
5 894
4.3%
North America
Latin America
1 201
1 648
1 018
1 758
18.0%
(6.3)%
Americas
2 849
2 776
2.6%
13 372
13 645
(2.0)%
Total
Net sales
Year-on-year, our net sales decreased by 2.0% in theyear ended
December 31, 2012 compared to the year ended December 31,
2011. The 2.0% decrease in our net sales was primarily due to
modifying our structure to align with our strategy tofocus on mobile
broadband as we streamlined our portfolios, divested non-core
businesses and exited from loss-generating and poorly performing
contracts and countries. The decrease in net sales due to the
modication of our structure was partially offset by higher sales of
infrastructure equipment and slightly higher sales of services in the
second half of 2012.
Of total net sales, Mobile Broadband contributed EUR 6.0 billion in
the year ended December 31, 2012 (EUR 6.3 billion in the year ended
December 31, 2011) and Global Services contributed EUR 6.9 billion
in the year ended December 31, 2012 (EUR 6.7 billion in the year
ended December 31, 2011).
Net sales in Japan accounted for our largest concentration of net
sales in the year ended December 31, 2012, representing 16.3%
ofnet sales (11.2% in the year ended December 31, 2011). Other
regions contributing signicant percentages of net sales in the year
ended December 31, 2012 include West Europe, representing
14.2% of net sales (14.9% in the year ended December 31, 2011),
and Latin America representing 12.3% of net sales (12.9% in the year
ended December 31, 2011).
36
On a regional basis, net sales in the year ended December 31, 2012
were driven primarily by strength in our Asia and Middle East region,
most notably Japan, which saw an increase in net sales of 41.7% due
to strong growth in sales of both infrastructure equipment and
services as a result of the 4G (LTE) roll-outs by mobile operators in
Japan, which represented a combination of organic growth and the
impact of the Acquired Motorola Assets. These positive
developments were partially offset by decreases in net sales in India
and Greater China as a result of reduced operator spending. Our net
sales in the Americas region also increased 2.6%, led by an increase
in net sales in North America of 18.0% driven by the 4G (LTE)
network roll-out with our customer T-Mobile USA partially offset by a
decrease in net sales in Latin America. Overall growth in net sales in
these regions was offset by lower sales in our Europe and Africa
region, which overall decreased by 12.0% in the year ended
December 31, 2012 as compared to year ended December 31, 2011,
due to the 19.5% and 17.3% decline in net sales in North East Europe
and South East Europe, respectively, principally as a result of lower
sales in services and infrastructure equipment.
Protability
Our gross prot decreased to EUR 3 455 million in the year ended
December 31, 2012, compared with EUR 3 708 million in the year
ended December 31, 2011, with a gross margin of 25.8% (27.2% in
the year ended December 31, 2011). The decrease in gross margin
was primarily attributable to specic items recorded in cost of sales
which increased to EUR 653 million in the year ended December 31,
2012 (EUR 51 million in the year ended December 31, 2011), due to
the recording of personnel restructuring costs in connection with our
restructuring program and additional costs incurred during the
period as we realigned our customer contract and geographic
market portfolio to terminate certain loss-generating and poorly
performing contracts and to withdraw from certain countries in line
with the transformation and restructuring program. Our gross prot
before specic items increased to EUR 4 108 million in the year
ended December 31, 2012, compared with EUR 3 759 million in the
year ended December 31, 2011, with a gross margin before specic
items of 30.7% (27.5% in the year ended December 31, 2011), as a
result of our strategy to focus on mobile broadband and products
and services with higher margins and to exit less protable contracts
and countries as well as, in the second half of the year, due to the
sale of an unusually large proportion of higher margin products and
software in our priority markets.
Research and development expenses
R&D expenses were EUR 2 116 million in the year ended December
31, 2012, compared with EUR 2 076 million in the year ended
December 31, 2011. In the year ended December 31, 2012, R&D
expenses included specic items relating to restructuring and other
related charges of EUR 170 million (EUR 28 million in the year ended
December 31, 2011) and purchase price accounting related items of
EUR 38 million (EUR 79 million in the year ended December 31,
2011). In 2012, the restructuring and related charges related to
expenses in connection with the reduction in our global workforce. In
2012 and 2011, purchase price accounting charges related to the
amortization of nite lived intangible assets (customer relationships,
developed technology and licenses to use tradenames and
trademarks) recognized in the purchase price allocation stemming
from the Groups formation and the subsequent acquisition of the
Acquired Motorola Assets. R&D expenses before specic items
decreased in the year ended December 31, 2012 to EUR 1 908
million and 14.3% of net sales compared to EUR 1 969 million and
14.4% of net sales in the year ended December 31, 2011 due to the
divestment of our non-core assets and the elimination of related R&D
expenses and our cost control initiatives relating to the
transformation and restructuring program that was implemented in
2012 whereby we decreased investment in previous-generation
radio technologies and non-core portfolio areas.

Selling and marketing expenses decreased by 4.0% to EUR 1 267
million, in the year ended December 31, 2012, compared with
EUR1320 million in the year ended December 31, 2011. In the
yearended December 31, 2012, selling and marketing expenses
included specic items relating to restructuring and other charges
ofEUR 116 million (EUR 22 million in the year ended December 31,
2011) and purchase price accounting related items of EUR 266
million (EUR 308 million in the year ended December 31, 2011).
In2012, restructuring and related charges were largely driven by
expenses inconnection with the reduction in our global workforce.
Inboth 2012 and 2011, purchase price accounting charges related
tothe amortization of nite lived intangible assets (customer
relationships, developed technology and licenses to use tradenames
and trademarks) recognized in the purchase price allocation
stemming from the Groups formation and the subsequent
acquisition of the Acquired Motorola Assets. Selling and marketing
expenses before specic items were EUR 885 million in the year
ended December 31, 2012 compared to EUR 990 million in the year
ended December 31, 2011, representing 6.6% and 7.3% of net sales,
respectively. This decrease in selling and marketing expenses was
primarily related to our implementing measures to reduce
discretionary expenditure, and overall lower selling and marketing
activities due to the impact of the transformation and restructuring
program implemented in 2012.
Administrative and general expenses were EUR 695 million in the
year ended December 31, 2012, compared with EUR 534 million in
the same period of 2011. In the year ended December 31, 2012,
administrative and general expenses included restructuring charges
and other one-time charges of EUR 242 million (EUR 36 million in the
same period of 2011) and purchace price accounting related items of
EUR 0 million (EUR 1 million in the same period in 2011). In 2012, the
restructuring and related charges related to expenses in connection
with the reduction in our global workforce, exiting certain
underperforming customer contracts and the withdrawal and
closure of real estate sites as well as other charges consisting
ofconsultancy fees in connection with the restructuring program.
Administrative and general expenses before specic items
decreased slightly in the year ended December 31, 2012 to
EUR453million and 3.4% of net sales compared to EUR 497 million
and 3.6% of net sales in the year ended December 31, 2011. This
decrease in administrative and general expenses was primarily due
to the restructuring efforts undertaken in connection with the
transformation and restructuring program implemented in 2012.
Annual Report 2012
37

Other income and expenses decreased to an expense of EUR 118
million in the year ended December 31, 2012 as compared to income
of EUR 13 million in the year ended December 31, 2011 as we
recorded a net loss of EUR 50 million from the sale of divested
businesses, EUR 40 million in costs resulting from the sale of
receivables transactions and EUR 28 million of additional expenses
from the result of bad debt write-offs during 2012.
Operating results
We had an operating loss of EUR 741 million in the year ended
December 31, 2012, compared with an operating loss of EUR 209
million in the year ended December 31, 2011, resulting in an
operating margin of negative 5.5% and negative 1.5% in the years
ended December 31, 2012 and 2011, respectively. Before specic
items, we had operating prot of EUR 822 million in the year ended
December 31, 2012 as compared to an operating prot of EUR 335
million in the year ended December 31, 2011. This increase in
operating prot before specic items, year-on-year, was primarily
attributable to our change in strategy and increased sales of higher
margin products and to the reductions in expenses in connection
with our cost control initiatives relating to the restructuring and
transformation program implemented in 2012, as described above.
Financial income and expenses, net, and other nancial results
We incurred a net expense in nancial income and expenses, net, and
other nancial results of EUR 307 million in the year ended December
31, 2012, compared with a net expense of EUR 151 million in the year
ended December 31, 2011. In the year ended December 31, 2012, our
nancial income and expenses, net, and other nancial results
consisted of nancial income of EUR 15 million in the year ended
December 31, 2012, offset by nancial expenses relating to interest
expense on loans and credit facilities of EUR 113 million and net foreign
38
exchange losses of EUR 199 million. In the year ended December 31,
2011, our nancial income and expenses, net, and other nancial
results consisted of nancial income of EUR 15 million, offset by
nancial expenses relating to interest expense on our loans and credit
facilities of EUR 95 million and net foreign exchange losses of EUR 58
million. The increase in net foreign exchange losses of EUR 141 million
was primarily due to currency exposures that cannot be hedged.
Income tax expense
We had an income tax expense of EUR 342 million in the year ended
December 31, 2012, compared with an income tax expense of
EUR234 million in the year ended December 31, 2011. Despite
incurring losses before tax of EUR 1 040 million in the year ended
December 31, 2012 and EUR 377 million in the year ended
December 31, 2011, we recorded an expense during 2012 and 2011
primarily due to the increase in valuation allowance on deferred tax
assets of EUR 640 million and EUR 265 million, respectively, related
to Finnish and German tax losses and temporary differences in 2012
and Finnish tax losses and temporary differences in 2011 for which
we are unable to recognize deferred tax benets. Our effective
income tax expense is also affected by the various tax laws in effect
in the different jurisdictions in which we earn revenue. The increase in
income tax expense also reects changes in prot mix between
jurisdictions from year to year.
Year ended December 31, 2011 compared with year ended
December 31, 2010
Our operating results for the year ended December 31, 2011
includeeight months of the results of the Acquired Motorola Assets.
Accordingly, our results for that period are not directly comparable
toour results for the year ended December 31, 2010.
The following table sets forth selective line items from our consolidated income statement and the percentage of net sales that they represent
for the years ended December 31, 2011 and 2010.
2011
2010
Percentage
of net
sales
Before
specic
items
Specic
items
13 645 100.0%
(9 937) 72.8%
12 206
(8 767)
(174)
Percentage
of net
sales
(%)
change
12 206 100.0%
(8 941) 73.3%
11.8%
11.1%
Before
specic
items
Specic
items
Net sales
Cost of sales
13 645
(9 886)
(51)
3 759
(1 969)
(990)
(497)
32
(51)
(107)
(330)
(37)
(19)
3 708
(2 076)
(1 320)
(534)
13
27.2%
15.2%
9.7%
3.9%
0.1%
3 439
(1 804)
(992)
(459)
(18)
(174)
(212)
(307)
(76)
(27)
3 265
(2 016)
(1 299)
(535)
(45)
335
(544)
(209)
1.5%
166
(796)
(630)
Gross prot
R&D expenses
Operating prot/(loss)
Total
Total

Financial income and expenses, net, and other
nancialresults
(17)
11
(151)
(248)
Loss before tax

Income tax expense
(377)
(234)
(867)
(164)
Loss for the year from continuing operations
(611)
(1 031)
26.7%
13.6%
16.5%
3.0%
10.6%
1.6%
4.4%
(0.2)%
0.4% (128.9)%
5.2%
(66.8)%
The following table sets forth Nokia Siemens Networks net sales for the years ended December 31, 2011 and 2010 by segment and current
geographic area based on customer location.
Nokia Siemens Networks selected segment data
Mobile
Broadband
Global
Services
All other
segments1
Other
Total
2011
Net sales
6 335
214
3.4%
6 737
229
3.4%
573
(108)
(18.8)%
13 645
335
2.5%
2010
Net sales
5 789
153
2.6%
5 889
84
1.4%
528
(71)
(13.4)%
12 206
166
1.4%
All other segments represents the aggregated results of several businesses that were divested or that were planned to be divested during the period.
Annual Report 2012
39
Nokia Siemens Networks net sales by geographic area

For the year ended

December 31
2011
2010
North East Europe

West Europe
South East Europe
Africa
1 107
2 032
1 257
579
1 086
2 115
1 378
514
(%) change
1.9%
(3.9)%
(8.8)%
12.6%
Europe and Africa
4 975
5 093
(2.3)%
Middle East
Greater China
Japan
India
APAC
817
1 457
1 533
911
1 176
876
1 448
704
885
1 110
(6.7)%
0.6%
117.8%
2.9%
5.9%
Asia and Middle East
5 894
5 023
17.3%
North America
Latin America
1 018
1 758
649
1 441
56.9%
22.0%
Americas
2 776
2 090
32.8%
13 645
12 206
11.8%
Total
Net sales
Year-on-year, net sales growth was 11.8% for the year ended
December 31, 2011 compared to the year ended December 31,
2010. The 11.8% increase in our net sales was driven primarily by the
contribution from the Acquired Motorola Assets. The Acquired
Motorola Assets contributed net sales of EUR 894 million in eight
months of trading following the completion of the Motorola Solutions
Acquisition on April 30, 2011. Excluding the Acquired Motorola
Assets, net sales would have increased 4.5% year-on-year, primarily
driven by growth in Global Services.
Of total net sales, Mobile Broadband contributed EUR 6.3 billion in
the year ended December 31, 2011 (EUR 5.8 billion in the year ended
December 31, 2010) and Global Services contributed EUR 6.7 billion
in the year ended December 31, 2011 (EUR 5.9 billion in the year
ended December 31, 2010). In 2011, we continued to see growth in
both the Mobile Broadband and Global Services business units.
Growth in the Mobile Broadband business was primarily driven by
sales of GSM and WCDMA technology as network upgrade,
expansion and roll-out work continued across a number of regions.
In Global services, managed services remained a strong trend in the
industry, while the network implementation business, which is very
closely linked to the Mobile Broadband business, also grew.
40
Net sales in West Europe accounted for our largest concentration of

net sales in the year ended December 31, 2011, representing 14.9%
of our net sales (17.3% in the year ended December 31, 2010). Other
regions contributing signicant percentages of net sales in the year
ended December 31, 2011 include Latin America 12.9% (11.8% in
the year ended December 31, 2010), Japan 11.2% (5.8% in the year
ended December 31, 2010) and Greater China 10.7% (11.9% in the
year ended December 31, 2010).
On a regional basis, net sales in the year ended December 31, 2011
were driven primarily by strength in the Americas region where North
America and Latin America sales increased by 56.9% and 22.0%
respectively, as compared to the year ended December 31, 2010,
where sales were boosted by the acquisition of the Acquired Motorola
Assets, primarily in the CDMA business with Verizon. Our net sales in
Asia and the Middle East also increased by 17.3% in the year ended
December 31, 2011 as compared to the year ended December 31,
2010, primarily driven by the increase in sales in Japan. In Japan, net
sales increased by 117.8% as our existing business continued to be
driven by the network roll-out with our customer SoftBank and with
the Motorola Solutions Acquisition, we further strengthened our
position in this key market by gaining KDDI as a new customer. Growth
in net sales in these regions was offset by a decrease in net sales in our
Europe and Africa region where net sales decreased 2.3% since the
prior year due to difcult conditions in Europe. In particular, West and
South Europe continued to be characterized by intense competition
for market share around single Radio Access Network (RAN) projects
resulting in an impact on our pricing.
Protability
Our gross prot increased to EUR 3 708 million in the year ended
December 31, 2011, compared with EUR 3 265 million for the year
ended December 31, 2010, with a gross margin of 27.2% (26.7% in
the year ended December 31, 2010). The increase in gross margin
was inuenced by a decrease in specic items recorded in cost of
sales, which decreased to EUR 51 million in the year ended
December 31, 2011 (EUR 174 million in the year ended December 31,
2010) due to the recording of additional personnel restructuring and
structural restructuring for outsourcing and closing manufacturing
sites and other real estate locations in 2010. Our gross prot before
specic items increased to EUR 3 759 million in the year ended
December 31, 2011, compared with EUR 3 439 million in the year
ended December 31, 2010, with a gross margin before specic items
of 27.5% (28.2% in the year ended December 31, 2010) due to the
impact from the Acquired Motorola Assets which was partially offset
by the growth in our Global Services business unit, which generally
has lower gross margins than our other products.
R&D expenses were EUR 2 076 million in the year ended December
31, 2011, compared with EUR 2 016 million for the year ended
December 31, 2010. In the year ended December 31, 2011, R&D
expenses included specic items relating to restructuring and other
related charges of EUR 28 million (EUR 19 million in the year ended
December 31, 2010) and purchase price accounting related items of
EUR 79 million (EUR 193 million in the year ended December 31,
2010). In 2011 and 2010, purchase price accounting charges related
to the amortization of nite lived intangible assets (customer
relationships, developed technology and licenses to use tradenames
and trademarks) recognized in the purchase price allocation
stemming from the Groups formation and the subsequent
acquisition of the Acquired Motorola Assets. R&D expenses before
specic items increased in the year ended December 31, 2011 to
EUR 1 969 million and 14.4% of net sales compared to EUR 1 804
million and 14.8% of net sales in the year ended December 31, 2010,
primarily due to additional R&D expenses due, to the consolidation of
the Acquired Motorola Assets and related R&D activities in 2011.

In the year ended December 31, 2011, our selling and marketing
expenses increased slightly by 1.6% to EUR 1 320 million, compared
with EUR 1 299 million in the year ended December 31, 2010. In the
year ended December 31, 2011, selling and marketing expenses
included specic items relating to restructuring and other charges of
EUR 22 million (EUR 21 million in the year ended December 31, 2010)
and purchase price accounting related items of EUR 308 million
(EUR 286 million in the year ended December 31, 2010). In 2011 and
2012, purchase price accounting related items consist of the
amortization of nite lived intangible assets related both to the
Groups formation and the subsequent Motorola Solutions
Acquisition. Selling and marketing expenses before specic items
were EUR 990 million in the year ended December 31, 2011
compared to EUR 992 million in the year ended December 31, 2010,
representing 7.3% and 8.1% of net sales, respectively. Despite
consolidation of eight months of the Acquired Motorola Assets and
related selling and marketing activities in 2011, selling and marketing
expenses before specic items remained relatively consistent
year-on-year due to restructuring measures originally announced in
November 2009.
In the year ended December 31, 2011, administrative and general
expenses were EUR 534 million (EUR 535 million in the year ended
December 31, 2010) representing 3.9% of our net sales (4.4% in the
year ended December 31, 2010). Administrative and general
expenses for the year ended December 31, 2011 included
restructuring charges and merger-related charges of EUR 36 million
(EUR 76 million in the year ended December 31, 2010) and purchase
price accounting related items of EUR 1 million (EUR 0 million in the
year ended December 31, 2010). Restructuring charges in 2011
consisted primarily of personnel restructuring charges. Mergerrelated charges related to additional costs incurred for the
realignment of the product portfolio. Administrative and general
expenses before specic items were EUR 497 million and 3.6%
ofnet sales in the year ended December 31, 2011 compared to
EUR459 million and 3.8% of net sales in the year ended December
31, 2010. This decrease in our administrative and general expenses
as a percentage of net sales was primarily due to restructuring
efforts subsequent to the acquisition of the Motorola Acquired
Assets.
Annual Report 2012
41

Other income and expenses, net increased to income of EUR 13
million in the year ended December 31, 2011 as compared to an
expense of EUR 45 million in the year ended December 31, 2010 as
we recorded other income of EUR 92 million and other expenses of
EUR 79 million in the year ended December 31, 2011 as compared to
other income of EUR 97 million and other expenses of EUR 142
million in the year ended December 31, 2010. The decrease in other
expenses in the year ended December 31, 2011 was primarily
attributable to our recording in 2010 other expenses of EUR 28
million in charges related to the transfer of the Groups Italian Radio
Access activities to an IT consulting and solutions company.
Operating results
We had an operating loss of EUR 209 million in the year ended
December 31, 2011, compared with an operating loss of EUR 630
million in the year ended December 31, 2010, resulting in operating
margins of negative 1.5% and negative 5.2% in the years ended
December 31, 2011 and 2010, respectively. Before specic items,
we had operating prot of EUR 335 million in the year ended
December 31, 2011 as compared to an operating prot of EUR 166
million in the year ended December 31, 2010. This increase in
operating prot before specic items, year-on-year, was primarily
attributable to an increase in net sales from the Motorola Solutions
Acquisition, additional growth in net sales from our other business
units and lower operating expenses in connection with certain
restructuring activities as originally announced in November 2009.
Financial income and expenses, net, and other nancial results
We incurred a net expense in nancial income and expenses, net,
and other nancial results of EUR 151 million in the year ended
December 31, 2011, compared with a net expense of EUR 248
million in the year ended December 31, 2010. In the year ended
December 31, 2011, our nancial income and expenses, net, and
other nancial results consisted of nancial income of EUR 15 million,
offset by nancial expenses relating to interest expense on interestbearing liabilities of EUR 95 million and net foreign exchange losses
of EUR 58 million. In the year ended December 31, 2010, nancial
income was EUR 14 million, interest expense on interest-bearing
liabilities and other nancial expenses was EUR 157 million and net
foreign exchange losses were EUR 105 million. The decrease in
interest expense on interest-bearing liabilities of EUR 42 million was
primarily due to the reduction in interest expense resulting from the
shareholder loan conversions in 2010. The decrease in net foreign
exchange losses of EUR 47 million was primarily due to decreased
net foreign exchange losses primarily from currency exposures
which cannot be hedged.
42
Income tax expense

We had an income tax expense of EUR 234 million in the year ended
December 31, 2011, compared with an income tax expense of EUR
164 million in the year ended December 31, 2010. Despite incurring
losses before tax of EUR 377 million in the year ended December 31,
2011 and EUR 867 million in the year ended December 31, 2010, we
recorded an expense during 2011 and 2010 primarily due to the
increase in valuation allowance on deferred tax assets of EUR 265
million and EUR 278 million, respectively, related to Finnish tax losses
and temporary differences for which we are unable to recognize
deferred tax benets. Our income tax expense is also affected by the
various tax laws in effect in the different jurisdictions in which we earn
revenue. The increase in tax expense also reects changes in prot
mix between jurisdictions from year to year.
Liquidity and capital resources
Liquidity describes the ability of a company to generate sufcient
cash ows to meet the cash requirements of its business operations,
including working capital needs, capital expenditures, debt service
obligations, other commitments, contractual obligations and
acquisitions. Our primary sources of liquidity are provided by our
cash from operations, long and short-term nancings and historical
shareholder support. Our liquidity requirements arise primarily to
fund our future working capital needs, capital expenditures, R&D
expenditures and to meet our debt services obligations.
Certain of our subsidiaries operate in jurisdictions highly regulated
bylocal central banks or international regulations, such as Iran,
Pakistan, Venezuela and Uzbekistan. In these countries, the ability
ofour subsidiaries to transfer funds to their parent companies or our
Group treasury in the form of cash dividends, loans or advances is
very limited. We estimate that the funds retained in these countries
for relatively long periods of time have uctuated between EUR 50
million to 150 million in the periods under review. We believe that
these limitations have not had and are not expected to have a
material impact on our ability to meet our cash obligations.
Cash ows
At December 31, 2012, our cash and cash equivalents were
EUR2418million compared to EUR 1 613 million at December 31, 2011.
The table below sets forth information regarding our cash ows from
continuing and discontinued operations for the years ended
December 31, 2012, 2011 and 2010.
For the year ended
December 31
EURm
Statement of cash ows

information:
Net cash from operating activities
Net cash used in investing activities
Net cash (used in)/from nancing
activities
Net increase in cash andcash
equivalents
Capital expenditures1
Change in net working capital:
Decrease in current receivables
Decrease/(increase) in inventories
Increase/(decrease) in interest-free
liabilities2
Change in net working capital
1
2012
2011
2010
1 628
(261)
324
(989)
3
(244)
(520)
1 155
641
805
(216)
415
(303)
438
(306)
776
198
528
(44)
852
(209)
11
985
(468)
16
(415)
228
Our net cash used in investing activities was EUR 261 million for the
year ended December 31, 2012. This was primarily attributable to
cash used for capital expenditures of EUR 216 million and payments
in connection with the disposal of businesses and Group companies
of EUR 125 million during the period. These cash outows were
partially offset by cash inows of EUR 64 million primarily in
connection with a purchase price adjustment relating to the Motorola
Solutions Acquisition, net of acquired cash and proceeds from
investments and other miscellaneous cash outows and inows.
Our net cash used in nancing activities was EUR 520 million for the
year ended December 31, 2012. During the year we repaid EUR 264
million of long-term interest-bearing liabilities, primarily consisting of
scheduled repayments of EUR 100 million of our EIB Facility and
EUR 44 million scheduled repayments of our Finnish Pension Loan
and the voluntary prepayment of EUR 118 million and termination of
our SEB Loan. During 2012, we also repaid EUR 244 million of
short-term borrowings, primarily consisting of partial repayment of
our Term Loan, renancing of our South African preference share
subscription agreement and reduction of borrowings under the
Commercial Paper Program and local borrowings on committed
and uncommitted bases.
Capital expenditures represent purchases of property, plant and equipment and

intangible assets.
Includes changes in the following line items in the statement of nancial position:
accounts payable, accrued expenses, provisions and other short-term liabilities.
The cash outows for restructuring and other specic items,

excluding impairments and PPA related charges were EUR 645
million, EUR 188 million and EUR 510 million for the years ended
December 31, 2012, 2011 and 2010, respectively.
Year ended December 31, 2012
Our net cash from operating activities was EUR 1 628 million for the
year ended December 31, 2012. Although we recorded a loss for the
year of EUR 1 445 million, after adjusting for non-cash items, such as
depreciation and amortization, which was EUR 587 million and
restructuring and other specic items, which were EUR 1 162 million,
we had cash ows from operating activities before changes in
working capital of EUR 1 160 million.
The change in our net working capital provided cash ows of EUR
985 million, which was a net reduction in working capital for the year.
The reduction in net working capital resulted primarily from our
management of accounts receivable which provided cash ow of
EUR 776 million primarily due to improved cash collections and an
increase in sales of receivables during the year which further
enhanced our cash collection efforts. A reduction in inventories
during the year provided cash inows of EUR 198 and was the result
of effective inventory management during the year.
Annual Report 2012
43

Our net cash from operating activities was EUR 324 million for the
year ended December 31, 2011. Although we recorded a loss for the
year of EUR 698 million, after adjusting for non-cash items such as
depreciation and amortization, which was EUR 711 million, and other
non-cash items such as restructuring and other specic items,
income taxes and nancial income and expenses, which totaled
EUR 447 million, we had cash ows from operating activities before
changes in working capital of EUR 564 million.
The change in our net working capital provided cash ows of EUR 16
million, which was a net reduction in working capital for the year. The
reduction in net working capital resulted primarily from our
management and sales of accounts receivable which provided cash
ow of EUR 528 million during the year but was offset by the
reduction in interest-free liabilities of EUR 468 million, which was
primarily attributable to a decrease in accrued expenses relating
mainly to a reduction in our deferred revenue balance from the prior
year, and an increase in inventories of EUR 44 million..
year ended December 31, 2011. In connection with the Motorola
Solutions Acquisition, we had a cash outow, net of acquired cash
received, of EUR 781 million. In addition, cash used for capital
expenditures for the period resulted in a cash outow of EUR 303
million. These outows were partially offset by proceeds from
short-term and other long-term loan receivables and proceeds from
the sale of property, plant and equipment and intangible assets.
Our net cash from nancing activities was EUR 1 155 million for the
year ended December 31, 2011. During 2011, we received proceeds
from our shareholders of EUR 1 000 million in relation to issuing
cumulative preferred shares, which represented the majority of our
nancing activities. We also received net proceeds from short-term
borrowings of EUR 232 million primarily from the EUR 2 000 million
revolving credit facility from 2009. During 2011, we also made
repayments of EUR 48 million of long-term interest-bearing liabilities,
primarily from the Finnish Pension Loan, and payments of EUR 29
million in dividends to non-controlling interests.
Our net cash from operating activities was EUR 3 million for the year
ended December 31, 2010. Although we recorded a loss for the year
of EUR 1,089 million, after adjusting for non-cash items such as
depreciation and amortization, which was EUR 843 million, and
other non-cash items such as restructuring and other specic items,
income taxes and nancial income and expenses, which totaled
EUR 558 million, we had cash ows from operating activities before
changes in working capital of EUR 405 million.
The change in our net working capital provided cash ows of EUR
228 million, which was a net reduction in working capital for the year.
The reduction in net working capital resulted primarily from our
management and sales of accounts receivable which provided cash
ow of EUR 835 million during the year but was offset by the
44
reduction in interest-free liabilities of EUR 415 million, which was

primarily attributable to reductions in total provisions relating mainly
to product portfolio optimization, and an increase in inventories of
EUR 209 million.
year ended December 31, 2010. This was primarily attributable to cash
used for capital expenditures of EUR 306 million. These cash outows
were partially offset by proceeds from short-term and other long-term
loan receivables and proceeds from the sale of property, plant and
equipment and other miscellaneous cash outows and inows.
Our net cash provided by nancing activities was EUR 641 million for
the year ended December 31, 2010. During 2010, we received
proceeds of EUR 229 million from our short-term borrowings, primarily
from the EUR 2 000 million Revolving Credit Facility from 2009 and the
Commercial Paper Program, and EUR 414 million from our long-term
interest-bearing liabilities, primarily from drawings under the Finnish
Pension Loan, Nordic Investment Bank Facility and SEB Loan.
Capital expenditures
Cash used for capital expenditures related to the purchases of
property, plant and equipment and intangible assets and primarily of
(a) cash used for the maintenance, upkeep and replacement of
assets in connection with the production and testing of our products
(Capital Expenditure); (b) cash used for development and testing of
new products in order to increase sales and protability (R&D
Capital Expenditure); (c) cash used in our Global Services business
unit (Global Services Expenditures); and (d) other capital
expenditures for real estate and central functions (Other Capital
Expenditure).
Investments in 2010 and 2011 included the development of a new
generation of radio platforms, the Multiradio generation, and
associated infrastructure software which required signicant initial
investments. In 2012, our focus on Mobile Broadband resulted in
increased capital expenditure on new technologies offset by a
reduction in investments in non-core areas, thus leading to a
reduction in overall capital expenditure.
In accordance with our current estimate, we expect the amount of
capital expenditures during 2013 to be approximately EUR 150 million,
to be funded from cash ow from operating activities.
Capital Expenditure
EURm
2012
2011
2010
Capital Expenditure
R&D Capital Expenditure
Global Services Expenditure
Other Capital Expenditure
20
113
21
62
48
138
27
90
44
144
35
83
Total
216
303
306
Capital resources
Our principal sources of funds are expected to be cash provided by
operations and amounts available under the Forward Starting Credit
Facility, our Commercial Paper program and our local credit facilities.
As of December 31, 2012, we have EUR 1 805 million in committed
facilities, of which EUR 750 million is undrawn.
Structured nance
Structured nance includes customer nancing and other third-party
nancing. Network operators in some markets sometimes require
their suppliers, including us, to arrange, facilitate or provide
long-term nancing as a condition to obtain or bid on infrastructure
projects.
Drawings under the Revolving Credit Facility will be available only if,
among other things, we comply with the nancial and other
covenants in the Revolving Credit Facility. Our ability to meet these
nancial covenants will depend on our results of operations, which
may be affected by factors outside our control.
Credit markets in general have been tight since 2009. Requests for
customer nancing and especially extended payment terms have
remained at a reasonably high level; however, during 2012, the
amount of nancing provided directly to our customers has
decreased. We do not currently intend to materially increase
nancing directly to our customers, which may have an adverse
effect on our ability to compete successfully for their business.
Rather, as a strategic market requirement, we plan to continue to
arrange and facilitate nancing, typically supported by export credit
or guarantee agencies, and provide extended payment terms to a
number of customers. Extended payment terms may continue to
result in a material aggregate amount of trade credits, but the
associated risk is mitigated by the fact that the portfolio relates to a
variety of customers.
We will continue to work towards our long-term nancial goals

whichinclude longer term nancing as a way to diversify our
fundingsources.
Contractual obligations
The following table sets forth our material contractual obligations at
December 31, 2012.
Contractual obligations
EURm
Forward Starting Facility

European Investment Bank
Nordic Investment Bank
Finnish Pension Loan
PSA1
Commercial Paper Program
Operating leases
Purchase commitments2
Other obligations
Total
Total
Less than
1 year
1-5 More than

years
5 years
600
150
80
132
44
82
474
799
52
100
45
44
82
141
509
48
600
50
35
88
44
231
290
4
102
2 413
969
1 342
102
The following table sets forth our total customer nancing,

outstanding and committed, for the years indicated.
Customer nance
EURm
Financing commitments
Outstanding long-term loans
(net of allowances and write-offs)
Current portion of outstanding
long-term loans (net of allowances
andwrite-offs)
Total
At December 31
2012
2011
2010
34
86
85
39
60
64
35
54
39
108
200
188
PSA relates to the amount outstanding under the PSA 2012 South African
Preference Shares Subscription Agreements.
2
Purchase commitments relate to commitments from service agreements,
outsourcing arrangements and inventory purchase obligations, primarily for
purchases in 2013 through 2014.
Annual Report 2012
45
We continue to make arrangements with nancial institutions and

investors to sell the credit risk that we have incurred from the
commitments and outstanding loans we have made, as well as from
the nancial guarantees we may have given. Should the demand for
customer nance increase in the future, we intend to further mitigate
our total structured nancing exposure, market conditions
permitting. In the years ended December 31, 2012, 2011 and 2010
we had no material bad debt allowances or write-offs.
We expect our structured nancing commitments to be nanced
mainly through the capital markets as well as through cash ow from
operations.
The structured nancing commitments are available under loan
facilities mainly negotiated with mobile operator customers to fund
capital expenditure relating to the purchase of our network
infrastructure equipment and services. Availability of the amounts is
dependent upon the borrowers continuing compliance with stated
nancial and operational covenants and compliance with other
administrative terms of the facilities.
Contingent obligations and liabilities
At December 31, 2012, guarantees provided to certain customers of
the Group in the form of bank guarantees, or corporate guarantees
issued by some of the Groups entities were EUR 864 million
(EUR1191 million at December 31, 2011), including commercial
guarantees of EUR 598 million (EUR 997 million at December 31,
2011). These instruments entitle the customer to claim payment as
compensation for non-performance by the Group of its obligations
under network infrastructure supply agreements.
46
At December 31, 2012, other guarantees on behalf of other

companies were EUR 11 million (EUR 0 million at December 31,
2011). These guarantees represented commercial guarantees
issued on behalf of third parties. The increase in volume is mainly due
to the transfer of guarantees in connection with the disposal of
certain businesses where contractual risks and revenues have been
transferred, but some of the commercial guarantees have not yet
been re-assigned legally.
Off-balance sheet arrangements
We have no material off-balance sheet arrangements that have, or
are reasonably likely to have, a current or future effect on our nancial
condition, changes in nancial condition, revenues or expenses,
results of operations, liquidity, capital expenditures or capital
resources that are material to investors.
Making the connections

An innovative approach
proach
to LTE helps us minimize
our environmental
al
impact and our costs.
Tommy Ljunggren ,
ment
Vice President of System Development
at Mobility Services, TeliaSonera
Read more about

our work with Telia
Country: Sweden
Number of subscribers:
Telia in Sweden is part ofTeliaSonera
group, which has 20 millionmobile
subscribers globally
Strategic focus:
The leading Swedish operator of
mobile communication, xed
communication and data
communication as well as broadband
Annual Report 2012

201
47
Business review Corporate responsibility
Understanding our impact
Our highlights
12.5%
At the end of 2012, 12.5% of
seniormanagement positions
were held by women
50 million
Spent on employee training
29%
Reduction in number of health
and safety recordable incidents
Corporate responsibility covers a wide

range of aspects including how we are run,
how we interact with the communities in
which we operate, and the impact we have
on the environment.
Our people
Workforce balancing
Our restructuring program which we are halfway through has
had a significant effect on employees. We have been consulting
with employee representatives including local Works Councils
where necessary and we have communicated to employees the
changes that affect them throughout the two-year restructuring.
We have followed country-specific legal requirements to find
socially responsible means of reducing our workforce and of
helping affected employees. Where possible, we have offered
alternative employment to people whose roles were being
removed.
As of December 31, 2012, we had approximately 58 400
employees. During the year, the rate of voluntary attrition was
9.9%. The rate of involuntary attrition was 14.2% and the rate
ofattrition due to common agreement was 5.8%.
Diversity and inclusion
At the end of 2012, 12.5% of senior management positions were
held by women, an increase of one percentage point from 2011.
As a company with Finnish and German heritage, Nokia Siemens
Networks also monitors the nationality of our managers: at the
end of 2012, 54% of senior management positions were held
bypeople without Finnish or German nationality.
Training and development
During 2012, we spent approximately EUR 50 million on training
for employees.
Health, safety and labor conditions
Our Code of Conduct and Global Labor Standard set out clear
requirements for labor conditions, based on the International
Labor Organization (ILO) conventions. We are implementing
theglobal standard at a country level, focusing on the highest
riskcountries for labor violations. Internal audits are used to
confirm compliance.
All indicators in this section of the Annual Report have

been assured by DNV Two Tomorrows.
48
Our health and safety management system is based on the

international standard OHSAS 18001. Contractors must also
comply with our health and safety standards, and we provide
training to contractors to facilitate this. Regular audits are used
tocheck compliance. In 2012, there were 151 health and safety
incidents recorded (down from 214 in 2011). We continue to aspire
to a completely safe, accident-free environment for our workers.
Nokia Siemens Networks Code of Conduct

The Code of Conduct establishes the ethical standards we expect
our people to meet, wherever they work. We train our employees
annually on ethical business conduct, and concerns can be reported
anonymously. Any reported issue is investigated by our Ethics and
Compliance Office.
This over-achieves on a commitment made five years ago on

GSM base station. We have so far applied energy efficient
measures to more than 4 200 radio mobile broadband sites.
Suppliers
Our global supplier requirements, which set standards in ethical,
environmental and social issues, form part of contractual
agreements with suppliers and must be met by every Nokia
Siemens Networks supplier. The requirements are frequently
updated: in 2012, we introduced additional points on human
rights and conflict minerals. Compliance is monitored through
system audits, of which 57 were conducted in 2012.
Radio waves and health

Wireless communication technologies operate well within the limits
recommended by the International Commission on Non-Ionizing
Radiation Protection and endorsed by the World Health
Organization, and we work to ensure continued compliance of
ourproducts with these requirements. Nokia Siemens Networks
engages with its stakeholders and in public discussions on this
topicas well as monitoring scientific studies.
More detailed audits are undertaken with some suppliers,

selected through a risk assessment process. During the course
of 2012, we completed 20 of these in-depth audits and initiated
afurther two.
Nokia Siemens Networks has a zero tolerance policy on conflict
minerals and we expect our suppliers to transmit that in turn to their
suppliers. In 2012, we approached 125 suppliers for due diligence,
as part of our involvement in the EICC/GeSI Extractives Working
Groups Conflict-Free Smelters program, completing due diligence
with 40 of them.
Environment
Nokia Siemens Networks environmental strategy has two key
elements:
Designing products and services that help telecoms operators
reduce the environmental impact of their networks
Ensuring maximized efficiency in our operations to minimize our
environmental impact
Renewable energy continues to form a substantial part of the

energy used in Nokia Siemens Networks own facilities over
38% of our energy usage is from certified renewable sources.
Society
Human rights
We recognize our responsibility to help ensure that our products
are used in a way that respects human rights. Our Code of
Conduct spells out our zero tolerance for the violation of human
rights. This commitment is reinforced in our human rights policy,
which establishes due diligence processes to identify and
address relevant risks across our global operations. Employees
are trained in human rights through ethical business training, and
those in high-risk roles such as procurement are given
additional training.
Community
Nokia Siemens Networks community strategy focuses on three
key areas where we can have the greatest impact: education and
Information Communications Technology, disaster preparedness
and relief, and the environment. We have policies in place relating
to disaster relief and to employee volunteering.
We operate an environmental management system certified to

the internationally recognized standard ISO 14001. We require
suppliers to have a documented Environmental Management
System compliant with ISO 14001 in place.
Nokia Siemens Networks portfolio reduces the environmental
impact of new and legacy telecommunications networks through
more efficient technology and renewable energy solutions to
reduce power consumption and greenhouse gas emissions.
By the end of 2012, Nokia Siemens Networks had improved the
energy efficiency of GSM base station products by 21%1 and
reduced the energy consumption of buildings by 8%2, compared
to 2007 levels.
1
2
rom best performance BTS to 2012 equivalent capacity configuration BTS.

F
Compared to a business as usual scenario created in 2007 as agreed with the
WWF.
For more information,

please see our
sustainability report online.
Annual Report 2012
49
Business review Risk factors
Understanding the risks we face

Every business activity brings with it a degree of risk, and the Board
recognizes that Nokia Siemens Networks must therefore manage a
range of risks in the course of its activities. This section provides a
description of the principal risk factors that could affect Nokia
Siemens Networks as we try to reach our business objectives.
8 There are a limited number of customers in the networks

infrastructure and related services business. Unfavorable
developments in relation to a major customer may have a
material adverse effect on our business, results of operations
and financial condition.
Our internal risk management is designed to identify and analyze

these risks, as well as to control them within acceptable parameters.
9 The mobile broadband infrastructure and related services

business relies on large multi-year contracts. Unfavorable
developments under such contracts may have a material
adverse effect on our business, results of operations and
financial condition.
The factors described below are not intended to form a definitive list
of all risks and uncertainties. In particular, the list excludes generic
risks common to many companies, such as terrorism, pandemics
and succession planning. There may be additional risks unknown
tous and other risks currently believed to be immaterial that could
become material. These risks, either individually or together, could
adversely affect our business, sales, results of operations and
financial condition from time to time.
The summary below covers all risk areas such as strategic,
operational, financial and hazard risks:
1 Our sales and profitability depend on our success in the
mobilebroadband infrastructure and related services market.
We may fail to effectively and profitably adapt our business and
operations in a timely manner to the increasingly diverse needs
of our customers in this market.
2 Competition in the mobile broadband infrastructure and related
services market is intense. We may be unable to maintain or
improve our market position or respond successfully to changes
in the competitive environment.
3 O
ur restructuring plan to improve financial performance and
competitiveness may not lead to sustainable improvements in our
overall competitiveness and profitability, and we may be unable
otherwise to continue to reduce operating expenses and other
costs. The costs, cash outflows and charges related to the
implementation of the restructuring plan, including the planned
personnel reductions, divestments of non-core businesses, the
termination of unprofitable contracts and exiting certain countries,
such as Iran, may be greater than currently estimated.
4 We may require further support from our shareholders and may
have conflicts of interest with them. Our shareholders may also
have conflicts of interests between themselves. We believe that
our shareholders are actively considering a number of strategic
alternatives in respect of their interests in Nokia Siemens
Networks B.V., including new investments by third parties and
anincrease or decrease in the shareholders ownership interests
in Nokia Siemens Networks. There can be no assurance of any
such intentions or the timing of any such plans, nor can there be
any assurance that the ownership of Nokia Siemens Networks
B.V. will, or will not, change in the future.
5 Lack of improvement of or worsening general economic and
financial markets conditions globally and regionally could have a
significant adverse impact on our business, the results of
operations, and our financial condition.
6 As the euro is our reporting currency, the dissolution of the euro
would result in increased costs to adjust our financial reporting,
and result in increased volatility in our reported results of
operations and financial condition.
7 We may fail to effectively and profitably invest in new competitive
products, services, upgrades and technologies and bring them
to market in a timely manner.
50
10 We may not be able to successfully consummate acquisitions

ordivestitures or integrate acquired businesses, and any
acquisitions or disposals may carry unanticipated liabilities.
11 We are exposed to local business risks in the countries in which
we operate. Our sales derived from, and our manufacturing
facilities and assets located in, emerging market countries
maybe materially adversely affected by economic, regulatory
and political or other developments in those countries, or by
other countries imposing regulations against imports to such
countries. As sales from those countries represent a significant
portion of our total sales, economic or political turmoil including
sudden devaluation of currency in those countries could
materially adversely affect our sales and results of operations.
Our investments in emerging market countries may also be
subject to other risks and uncertainties including challenges in
repatriation of cash. Business with customers in Iran has recently
become subject to significant further regulation by the European
Union, the United Nations and the USA.
Our Executive Board has decided to withdraw from Iran in a
controlled manner, and we are in the process of winding down
our business activities there. We expect to cease all revenuegenerating activities relating to Iran by June 30, 2013. Other
activities relating to the withdrawalsuch as dissolution of
thelocal branch, divestment or discontinuation of certain
shareholdings, closing of local bank accounts and resolution
ofcontractual and legal obligations in Iranwill take longer.
Despite this withdrawal, we may still be subject to new, existing,
or tightened export control regulations, sanctions, embargoes or
other forms of trade restrictions imposed on Iran. Additionally,
we may be exposed to customer claims and other actions as
well as investigations by authorities. The result of such claims,
actions and investigations may be difficult to predict and can
lead to lengthy disputes, fines or settlements, and could have
amaterial adverse affect on the results of operations and our
financial condition.
12 Our liquidity and our ability to meet our working capital
requirements depend on access to available credit under our
financing arrangements and other credit lines as well as cash at
hand. Ifthose sources of liquidity were to be unavailable, or
cannot be refinanced when they mature, this would have a
material adverse effect on our business, the results of
operations, and our financial condition.
13 If the limited number of suppliers we depend on fail to deliver
sufficient quantities of fully functional products, components,
sub-assemblies and software on favorable terms and in
compliance with our supplier requirements, our ability to
deliverour products and services profitably, in line with
qualityrequirements and on time, could be materially
adverselyaffected.
14 If any of the companies we partner and collaborate with were

tofail to perform as planned, or if we fail to achieve the
collaboration or partnering arrangements needed to succeed,
we may not be able to bring our products and services to market
successfully or in a timely way.
15 We may fail to manage our manufacturing, service creation,
delivery and logistics efficiently and without interruption, or fail
tomake timely and appropriate adjustments, or fail to ensure
thatour products and services meet our and our customers
requirements, and are delivered on time and in sufficient
volumes.
16 Rapid changes to existing regulations or technical standards or
the implementation of new regulations or technical standards
forproducts and services not previously regulated could be
disruptive, time consuming and costly to us.
17 Providing customer financing or extending payment terms to
customers can be a competitive requirement in the networks
infrastructure and related services business and may have a
material adverse effect on our business, results of operations
18 Any actual or alleged defects or other quality, safety and security
issues in our products and services could have a material
adverse effect on our sales, results of operations and reputation.
19 We have operations in a number of countries and, as a result,
face complex tax issues that could result in the obligation to
payadditional taxes in various jurisdictions.
20 We may be liable for any actual or alleged loss, improper
disclosure or leakage of any personal or consumer data
collected by us or our partners or subcontractors, made
available to us or stored in or through our products and services.
21 Our net sales, costs and results of operations are affected by
exchange rate fluctuations, particularly between the euro, which
is our reporting currency, and the US dollar, as well as with and
between other currencies.
22 Our products and services include increasingly complex
technologies, some of which have been developed by us or
licensed to us by third parties. As a consequence, evaluating
therights related to the technologies we use or intend to use is
increasingly challenging, and we expect increasingly to face
claims that we have infringed third parties intellectual property
rights. The use of these technologies may also result in
increased licensing costs for us, restrictions on our ability to use
certain technologies in our products and services, and/or costly
and time consuming litigation.
23 Our existing technology licenses may expire or otherwise
become subject to renegotiation. The inability to renew or finalize
such arrangements on acceptable commercial terms may result
in increased costs or other changes in terms that could
potentially have a material adverse effect on our operating results
24 Our products and services include numerous patented,
standardized or proprietary technologies, which we rely upon.
Third parties may use without a license or unlawfully infringe our
intellectual property, or commence actions seeking to establish
the invalidity of the intellectual property rights of these
technologies. This may have a material adverse effect on our
business and results of operations.
25 Changes in various types of regulation and trade policies as well

as enforcement of such regulation and policies in countries
around the world could have a material adverse effect on our
business and results of operations. In line with changes in
strategy, as well as in some cases a difficult political or business
environment and an increasingly complicated trade sanctions
environment, we have reduced operations and have exited or
are in the process of exiting certain countries, such as Iran.
Suchactions may trigger additional investigations or claims by
contracting parties. The result of such investigations or claims
may be difficult to predict and could lead to lengthy disputes or
fines or a settlement.
26 Our operations rely on the efficient and uninterrupted operation
of complex and centralized information technology systems and
networks, which are integrated with those of third parties. All
information technology systems, system upgrades and system
transitions are potentially vulnerable to damage, malfunction
orinterruption from a variety of sources that could materially
adversely affect our business, financial condition and results
ofoperations.
27 We may be unable to retain, motivate, develop and recruit
appropriately skilled employees.
28 Organized strikes or work stoppages by unionized employees
may have a material adverse effect on our business, financial
condition and results of operations.
29 An unfavorable outcome of litigation, or the conduct of litigation
while it is ongoing, could have a material adverse effect on our
business, results of operations and financial condition.
30 We are subject to environmental and health and safety laws that
restrict our operations or increase the costs of such operations.
31 Allegations of possible health risks from the electromagnetic
fields generated by base stations, and the lawsuits and publicity
relating to this matter, regardless of merit, could have a material
adverse effect on our sales, results of operations and reputation,
by increasing difficulty in obtaining sites for base stations, or by
leading regulatory bodies setting arbitrary use restrictions and
exposure limits, or by causing us to allocate additional monetary
and personnel resources to these issues.
32 We may be required to make further contributions to pension
plans.
33 Some of the Siemens carrier-related operations transferred
toushave been and continue to be the subject of criminal and
other governmental investigations related to whether certain
transactions and payments arranged by some current or former
employees of Siemens were unlawful. As a result of those
investigations, government authorities and others have taken
and may take further actions against Siemens and/or its
employees that may involve and affect the assets and
employees transferred by Siemens to us, or there may be
undetected additional violations that may have occurred prior
tothe transfer or violations that may have occurred after the
transfer of such assets and employees.
For further explanation of these risks, please refer to Nokias 20-F
filing, which includes risks relating to Nokia Siemens Networks.
Acopy can be found at nokia.com/investors.
Annual Report 2012
51
Innovative partnership
We are using innovation
to differentiate ourselves
in our markets.
Thibaud Rerolle,
Head of Technology, Safaricom
Read more about

our work with Safaricom
Country: Kenya
Number of customers:
19 million
Strategic focus: Innovation to
maintain a competitive edge
52
Governance
54 Corporate Governance

Annual Report 2012
53
Corporate Governance
Ensuring the clarity of our decision making
Given the deep and far-reaching transformation

underway at Nokia Siemens Networks, now is the time
forus to share our new strategy, organizational structure
and financial progress directly through this, our own
comprehensive Annual Report. This publication defines
who we are, what we do, and what sets us apart from our
peers. It also sets a new standard of transparency for us,
as we share, for the first time, information about the
performance of our business at a segment level.
As a leading global networks business, corporate governance
isimportant to us. Because Nokia Siemens Networks is not a
listed company, and reports through others, we do not formally
adopt external governance codes, although of course we fulfill
therequirements of our parent companies. However, we have
developed governance guidelines which set out the governance
responsibilities of our Board of Directors.
In March 2012, we made some major changes in how we govern,
how decisions are made, and how we track the execution of our
strategy. This move aimed to help us achieve our restructuring
goals and, beyond that, to support our transformation in the
longer term. The changes addressed what the senior
management team focuses on and how it implements its
decisions, and were designed to improve the speed and quality of
decision making, as well as tracking the results of those decisions.
Overall, our governance structure approach enables us to have a
clear change management process for employees and a robust
decision making process for shareholders.
54
Corporate governance
isimportant tous
as a leading global
networks business.
Jesper Ovesen
Chairman
Principal activities
We began independent operations on April 1, 2007, combining
Nokia Corporations (Nokia) networks business and Siemens AGs
(Siemens) carrier-related operations for fixed and mobile networks.
In April 2011, we acquired the majority of the wireless network
infrastructure assets of Motorola Solutions.
Today we are a leading global provider of telecommunications
infrastructure, with a focus on the mobile broadband market. In
ourcore addressable market, we are the second largest company
worldwide by revenue. We have a strong position in the newer
infrastructure technologies of 3G and 4G (LTE), and in LTE, we
had77 commercial contracts at the end of 2012.
Business review
A review of our principal activities and performance for the year is
contained in the 2012 highlights on pages 6 and 7, A letter from our
Chairman on page 8, the Chief Executive Officers strategic review
on pages 12 to 15, Our strategy and transformation on pages 18 to
20, How we operate and Where we operate on pages 24 to 27, the
Operating and Financial Review on pages 29 to 46, and the
Corporate responsibilty report on pages 48 and 49. A review of the
principal risks and uncertainties facing the Group is set out on
pages50 and 51.
Structure and management
Nokia Siemens Networks B.V. is a private company with limited
liability, registered in the Netherlands with its corporate seat in
TheHague. Our operational headquarters is in Espoo, Finland,
witha strong regional presence in Germany.
Nokia Siemens Networks current shareholders are Nokia and
Siemens. The Company has autonomy to carry on its business
independently of its shareholders. The Company is consolidated
inthe financials of Nokia Corporation, and accounted on an equity
basis by Siemens.
Membership of the Board of Directors
Our Board of Directors is comprised of seven directors, four of whom
are appointed by Nokia and three of whom are appointed by Siemens.
The appointed board members are employees of the parent
companies, except for the Chairman of the Board.
The Chairman and Chief Executive Officer (CEO) are appointed by

Nokia. The senior management team is appointed by the Chief
Executive Officer.
There were no loans granted to the members of the Board of
Directors at December 31, 2012.
The following table sets forth the names, ages and positions of the
members of the Board of Directors as of December 31, 2012.
Membership of the Board of Directors
Name
Age
Title
Jesper Ovesen
55
Chairman
Juha krs
47
Member of the Board
Timo Ihamuotila
46
Member of the Board
Joe Kaeser
55
Member of the Board
Barbara Kux
58
Member of the Board
Louise Pentland
40
Member of the Board
Peter Y. Solmssen
57
Member of the Board
A short biography of each of the members of the Board of Directors

is included below.
Jesper Ovesen
Jesper Ovesen is Chairman of our Board overseeing the strategic
direction of Nokia Siemens Networks. Prior to joining in September
2011, Mr. Ovesen held a number of senior management positions
inleading European companies, most recently serving as CFO of
Danish telecommunications group TDC during the companys
restructuring process and initial public offering. He also served as
CEO at Kirkbi, CFO at Lego, and CFO at Danske Bank. He currently
holds external positions as a member of the Board of Orkla Norway,
and a member of the Board of Skandinaviska Enskilda Banken.
Juha krs
Juha krs is Executive Vice President at Nokia, Human Resources,
responsible for their talent management, resourcing and
development, performance management and organizational
development. Mr. krs joined Nokia in 1993 and was appointed
tothe Nokia Leadership Team in 2010. He served in various
leadership positions including business, strategy, customer
services, marketing and finance, before moving to Human
Resources in 2005. Mr. krs holds a masters degree in
engineering from Helsinki University of Technology.
Annual Report 2012
55
Corporate Governance continued
Timo Ihamuotila
Timo Ihamuotila has been a member of the Nokia leadership team
since 2007 and of our Board since November 2009. Mr. Ihamuotila
joined Nokia in 1993 as Manager for Dealing & Risk Management.
After a three-year period away, he rejoined Nokia in1999 as Director
of Corporate Finance and was named Vice President Finance,
Corporate Treasurer of Nokia Corporation, Group Treasury in 2000.
In 2004, he became Senior Vice President for Nokias CDMA
business unit, an integral part of the Mobile Phones business group.
He was appointed Executive Vice President, Sales and Portfolio
Management, Mobile Phones in 2007 and became responsible for
Nokias global sales within the Markets unit in 2008. Prior to joining
Nokia, he worked as an Analyst in Asset and Liability Management
for the Kansallis Bank, Helsinki and from 1996 to 1999 he worked
forCitibank Plc as Vice President of Nordic Derivatives Sales.
Mr.Ihamuotila graduated from Helsinki School of Economics and
holds a degree of Master of Science (Economics) and Licentiate of
Science (Finance).
Joe Kaeser
In May 2006, Mr. Kaeser was appointed Member of the Managing
Board of Siemens AG and Chief Financial Officer (CFO). Special
Responsibilities within Siemens AG: Head of Corporate Finance and
Controlling, Siemens Financial Services, Siemens Real Estate and
Equity Investments. Prior to this, Mr. Kaeser served as chief strategy
officer for Siemens AG from 2004 to 2006 and as the chief financial
officer for the mobile communications group from 2001 to 2004.
Mr.Kaeser has additionally held various other positions within the
Siemens group since he joined Siemens in 1980. Mr. Kaeser also
serves on the Board of Directors of Allianz Deutschland AG, NXP
Semiconductors N.V. and Bosch Siemens Hausgerte GmbH.
Mr.Kaeser holds a business administration degree from
Fachhochschule Regensburg.
Barbara Kux
Barbara Kux is a member of the Managing Board of Siemens AG
since 2008. She is responsible for Supply Chain Management,
Global Shared Services and serves as the companys Chief
Sustainability Officer. Prior to joining Siemens she was as a member
of the Group Management Committee at Royal Philips Electronics.
Before she held top management positions at leading global
companies and also served as Management Consultant at
McKinsey & Company Inc. In 1995, she was included in the class of
1995 of Global Leaders of Tomorrow by the World Economic Forum
in Davos, Switzerland. Barbara Kux is a member of the Board of
Directors of Total S.A., France and a member of the Board of
Trustees of the Siemens Foundation. Barbara Kux holds an MBA
with Distinction from INSEAD Fontainbleau, France.
56
Louise Pentland
Louise Pentland is Executive Vice President, Chief Legal Officer at
Nokia, responsible for legal matters and protecting and enforcing the
companys vast portfolio ofpatents and other intellectual property.
Ms. Pentland joined Nokia Networks in the United Kingdom in 1998
as Senior Legal Counsel, and has since held positions within Nokia
including Senior Vice President and Chief Legal Officer, Acting Chief
Legal Officer, Vice President and Head of Legal, Enterprise
Solutions. She has been amember of the Nokia Leadership Team
since 2011. Before joining Nokia, Ms. Pentland held corporate
in-house legal positions after working in corporate private practice in
the United Kingdom. She is a member of several legal forums and
organizations, including the Association of General Counsels,
ChiefLegal Officers Roundtable and Global Leaders in Law, and
also serves as Vice Chair of the International Bar Association,
Corporate Counsel Forum. Ms. Pentland holds an LL.B (honors)
lawdegree and is a qualified and active solicitor in England and
Wales, inaddition to being a licensed attorney and an active
memberof the New York Bar.
Peter Y. Solmssen
Peter Y. Solmssen has served as a Member of the Managing
Board and General Counsel of Siemens AG since 2007. Prior
thereto he was Executive Vice President and General Counsel
of GE Healthcare. Mr. Solmssen studied at Harvard University and
theUniversity of Pennsylvania.
Changes during 2012
During the year, there were three outgoing Board Members:
Siegfried Russwurm (replaced by Barbara Kux in March 2012);
Niklas Savander (replaced by Juha krs in June 2012); and
RiikkaTieaho (replaced by Louise Pentland in August 2012).
Board meetings
During the year under review, the Board met on 12 occasions with all
directors eligible to attend doing so either in person or by proxy.
Directors responsibilities
The Board of Directors is accountable to Nokia Siemens Networks
shareholders (currently Nokia and Siemens), and is responsible for
the overall direction and supervision of the Group.
Each of the ultimate shareholders are listed on various stock
exchanges, including the New York Stock Exchange. The
Companys aim is to comply in all material respects with all rules
andregulations directly applicable to it, as well as to meet all
requirements to the extent applicable to the Company, including (but
not limited to) those deriving from the rules and regulations related to
the various stock exchange listings of the ultimate shareholders.
The operations of Nokia Siemens Networks are managed under the
direction of the Board within the framework set by Book 2 Dutch Civil
Code and the Articles of Association of the Company as well as the
Shareholders Agreement, dated April 3, 2007, by and between
Nokia, Siemens, and Nokia Siemens Networks B.V. (Shareholders
Agreement).
Code of Conduct; Compliance Office; Internal Audit,
including internal investigations
The Board will oversee that the Group has proper moral and ethical
values. The Board will approve a Code of Conduct for the Group and
oversee that the management implements such a code. The Group
has a Compliance Office headed by the Chief Compliance Officer.
The Chief Compliance Officer will give a quarterly report to the Board
on any actual matters, and an annual report on organization,
responsibilities and staffing of the Compliance Office.
The Group has an Internal Audit function, the head of which reports
to the Board and to the head of the Internal Audit function of Nokia.
The Board shall receive a report on internal audit activities and
pending internal investigations from the head of the Internal Audit
Function at least once in a quarter. The Board will annually review
theorganization, responsibilities and staffing of the Internal
AuditFunction.
Director compensation
It is the Groups policy that other than the Chairman, the directors will
not receive any separate compensation for the services they provide
as members of the Board of Directors.
Senior management team

Our operative management body is the senior management team
known as the Executive Board of Nokia Siemens Networks B.V.
The following table sets forth the names, ages and positions of
members of our senior management team.
Membership of the senior management team
Name
Age
Title
Rajeev Suri
45
Samih Elhage
51
Chief Financial Officer
Deepti Arora
53
Vice President Quality
Kathrin Buvac
32
Vice President Corporate

Strategy and CEO Office
Hans-Jrgen Bill
52

Human Resources
Ashish Chowdhary
47
Executive Vice President/

President Asia, Middle East and
Africa
Barry French
49

Marketing, Communications and
Corporate Affairs
Alexander Matuschka
42
Chief Restructuring Officer
Hossein Moiin
49

Technology and Innovation
Marc Rouanne
49

Mobile Broadband
Rene Svendsen-Tune
57
Executive Vice President/

President Europe and Latin
America
How the senior management team operates

The senior management team is chaired by the Chief Executive
Officer, and meets on a monthly basis.
Responsibilities of the senior management team
The senior management team reports to the Chief Executive Officer,
who leads allmatters relating to corporate governance, including
audit and compensation matters. It drives Nokia Siemens Networks
strategic agenda and decides on cross-company matters such as
governance, the Groups annual plan, large-scale capex approvals,
acquisitions and divestitures, large-scale credits and risks, people
matters, and executive appointments. These are areas where Nokia
Siemens Networks benefits from the diverse views and deliberation
of all of the senior management team.
Annual Report 2012
57
The Chief Executive Officer chairs four primary decision making

bodies:
1. The senior management team itself, known as the Executive
Board, which drives Nokia Siemens Networks strategic agenda,
sets long-term targets and makes company-wide policy decisions.
The Executive Board is also responsible for monitoring market
developments, fostering innovation, overseeing quality
improvements, developing talent, shaping our values and
culture,and change management.
2. The Executive Management Team sets Nokia Siemens Networks
three-year financial plan and annual budget, manages financial
performance, and makes day-to-day operational decisions as
wellas decisions relating to investments and product portfolio.
TheExecutive Management Team also focuses on near-term
performance management and forecasts, enforcement of policies
and targets, and regional and business unit plans, goals and
strategies. The Executive Management Team was established
inthefirst quarter of 2013 and assumes the responsibilities and
decision-making scope of the former group of executive officers
comprised of the Chief Executive Officer, the Chief Financial
Officerand the Chief Operating Officer.
3. The Business Transformation Board is focused on both
completing our restructuring as well as the structural changes
needed to continue to move Nokia Siemens Networks to becoming
a true leader. Areas covered will include Research and Development
(R&D) efficiency, product competitiveness, sales acceleration,
operations optimization, services transformation, financial backbone
and CFO processes, the continuation of our restructuring, and
various new interlock processes around procurement, operations
business units and CO.
4. The Pricing Committee sets the process and policy for pricing
decisions, and leads the commercial decision-making for major
deals. This committee ensures appropriate transparency and
scrutiny of key financial metrics, including profitability, project
assets,and cash flow.
The Chief Financial Officer chairs the Monthly Business Reviews,
ourprimary vehicle for tracking unit-level performance against our
strategy and annual plan.
16 +
17
58
A short biography for each of the

members of our senior management
team can be found on pages 16 and 17.
Management compensation
The remuneration of the Nokia Siemens Networks senior
management team and the Chairman of the Board of Directors was
as follows:
EURm
2012
2011
2010
Short-term employee benefits

Post-employment benefits
Other long-term benefits
Termination benefits
Share-based payment (income)/expense
20.5
1.0
1.3
4.0
9.4
0.7
5.2
0.6
(0.1)
7.6
0.5
4.8
(0.1)
Total
26.8
15.8
12.8
The number of senior management team members ranged from 13

to 15 members during the year (13 to 14 members in 2011 and 12 to
14 members in 2010).
The amounts presented above include remuneration to the
Executive Board members only for the time they were on
theseniormanagement team.
In addition to the senior management team members, the
remuneration to the Chairman of the Board of Directors is
includedinthe amounts presented above, since October 2011.
There were no loans granted to the members of the senior
management team at December 31, 2012.
Employees
The Board of Nokia Siemens Networks recognizes that its
employees are key to its success and is committed to creating a
working environment where everyone has the opportunity to learn,
develop and contribute to the success of the business, working
within a common set of values.
At December 31, 2012, we had 58 411 employees (73686
employees in 2011 and 66 160 employees in 2010), with the
decrease in headcount primarily due to our restructuring activities.
The number of personnel at December 31, 2012, divided according

to geographical location is as follows:
2012
North East Europe 1

West Europe 2
South East Europe
Africa
8 354
10 190
4 615
1 478
Europe & Africa
24 637
Middle East
Greater China
Japan
India
APAC
1 737
8 224
689
10 192
2 773
Asia & Middle East
23 615
North America
Latin America
3 045
7 114
Americas
10 159
Total
58 411
NE including Finland.
WE including Germany.
1
2
Compliance program
We have adopted compliance programs that foster a culture with
high ethical and integrity standards. We are committed to actively
combating improper business practices, including corruption, and
believe that as a multinational company we can play an important
role in this area. We also believe that our efforts in this area can
provide us with a competitive advantage with customers who
demand high ethical standards in their supply chain. We address
improper business practices using a four-step strategy:
Prevention: raise awareness through clear policies and training
ofemployees;
Detection: encourage people (internally and externally) to report
any concerns or suspected cases of improper conduct by
providing clear reporting channels and an anonymous whistleblowing mechanism, and develop tools to identify potential issues,
for example by detecting anomalies in expense claims;
Correction: investigate all reported concerns and take
appropriate action when cases of corruption are confirmed, for
example, through training or clarification of policies, disciplinary
actions and if necessary dismissal; and
Interaction: collaborate with others in the industry, including
competitors, customers and suppliers, to promote adoption
ofhigh ethical standards industry-wide.
Our Code of Conduct defines the boundaries between appropriate

and inappropriate business behavior. According to the Code of
Conduct, our employees must not engage in activities that may lead
to conflicts of interest, such as any agreement or understanding
regarding gifts, hospitality, favors, benefits, or bribes, in exchange
forgaining or maintaining business.
The Code of Conduct is supported by the Groups anti-corruption
compliance program, which includes among other things, a detailed
handbook, training, and several reporting/ helplines available for
employees and external workers. Each year there is a mandatory
ethical business training program for our employees focused on
compliance issues. In 2012, 89.7% of our employees completed
thetraining.
Government regulation
Our business is subject to direct and indirect regulation in each of the
countries in which we, the companies with which we work and our
customers do business. As a result, changes in or uncertainties
related to various types of regulations applicable to current or new
technologies, products and services could affect our business
adversely. Moreover, the implementation of technological or
legalrequirements could impact our products and services,
manufacturing and distribution processes, and could affect
thetiming of product and services introductions, the cost of our
production, products and services, as well as their commercial
success. Also, our business is subject to the impacts of changes in
trade policies or regulation favoring the local industry participants, as
well as other measures with potentially protectionist objectives that
the host governments in different countries may take. Export control,
tariffs or other fees or levies imposed on our products and services
as well as environmental, product safety and security and other
regulations that adversely affect the export, import, pricing or costs
of our products and services could adversely affect our net sales
and results of operations.
For example, in the USA, our products and services are subject
toawide range of government regulations that might have a direct
impact on our business, including, but not limited to, regulation
related to product certification, standards, spectrum management,
consumer privacy, competition and sustainability. In the European
Union the EU level or local member state regulation has in many
areas a direct impact on our business and customers. The European
regulation influences for example conditions for innovation for
multifunctional devices and services, as well as investment in fixed
and wireless broadband communication infrastructure. In China
newpartly local 3G telecom standards have been enacted that may
affect production processes and have impact on our business.
Additionally, with respect to certain developing market countries
forexample in Asia and in Latin and South America the business
environment we operate in can pose risks to our business due
tounpredictable, discriminatory or protectionist regulation.
Annual Report 2012
59
We are in continuous dialogue with relevant state agencies,

regulators and other decision makers through our experts, industry
associations and our representatives in Washington, D.C., Brussels,
Espoo, Berlin, Beijing, Delhi and Moscow and through our experts,
industry associations and representatives in the regions of Middle
East and Africa, Latin and South America and South-East Asia.
Policy on suppliers
We require a wide range of different components for production and
have more than 4,000 suppliers. We generally prefer to have multiple
sources for our components, but in certain cases we source some
components from a single or small number of suppliers. We source
components from a single or multiple suppliers depending on the
availability of the component, purchasing price, and terms and
conditions. Our business relationships with single suppliers typically
involve a high degree of cooperation in R&D, product design, and
manufacturing to ensure optimal product interoperability. We limit
supply risk in relation to components for which we have a single or
small number of suppliers by maintaining appropriate inventory
levels. Our collaboration with suppliers has also proven effective
incritical situations like the component shortages following the
Japanese earthquake in 2011. In 2012, as part of our working capital
initiative in connection with our restructuring program, we ramped
up the inbound supply hubs to reduce factory inventories and
increase inbound supplier delivery performance for our factories.
Component supply and demand planning
We have in place a demand and supply planning process that
matches customer product demand and component supply
plans.We share volume forecasts with the relevant suppliers
andsubsequently issue purchase orders to procure required
components. Depending on the specific arrangement for individual
suppliers and the respective lead times for the components they
aresupplying, forecasts may be used for purchasing components.
Notwithstanding, we have a policy not to issue volume or other
purchasing commitments to suppliers other than regular
purchaseorders.
Health, safety and the environment
Details of our approach to health and safety, and environment
issues, appear within the Corporate responsibility report on
pages48 to 49.
Auditor fees and services
The independent auditor is elected annually by our shareholders at
the Annual General Meeting. Audit fees are presented on page 125.
Dividend policy and the Annual General Meeting

The Annual General Meeting of Nokia Siemens Networks B.V. shall
take place by June 30, 2013. Subject to applicable mandatory
provisions of the laws in the Netherlands and approval at the Annual
General Meeting, the parent companies have agreed a general
dividend policy of an annual cash dividend at least equal to 50%
ofthe Groups consolidated net income for the financial years
endingafter December 31, 2008. This general policy may be
deviated fromin any year upon the joint decision of the parent
companies. TheBoard of Directors proposes no dividend and
nodistribution ofthe cumulative reserves for the year ending
December 31, 2012.
Jesper Ovesen
Chairman
Forward-looking statements
This report includes forward-looking statements. The words
should, could, continue, expect, target, estimate, may,
plans, will, believe, anticipate, intend, predict, assume,
positioned, shall, risk and other similar expressions that are
predictions or indications of future events and future trends
identify forward-looking statements.
These forward-looking statements include all matters that are
nothistorical facts, in particular but not limited to the statements
in, A letter from our Chairman, Chief Executive Officers strategic
review, Our strategy and transformation, Industry trends,
theOperating and Financial Review and Risk factors, are based
on the beliefs of the management of the Company as well as
assumptions made by and information currently available to the
management of the Company, and such statements may
constitute forward-looking statements.
Such forward-looking statements involve known and unknown
risks, uncertainties and other important factors that could cause
the actual results, performance or achievements of the Group,
orindustry results, to differ materially from any future results,
performance or achievements expressed or implied by such
forward-looking statements.
Such risks, uncertainties and other important factors include,
among other things, general economic and business conditions,
the competitive environment, the ability to employ competent
personnel, market development relating to the sector and other
risks described in Risk factors.
The forward-looking statements are not guarantees of the future
operational or financial performance of the Group.
60
Financial
statements
Consolidated Financial Statements 2012
62 Consolidated Income Statement
ofComprehensive Income
ofFinancialPosition
65 Consolidated Statement ofCash Flows
66 Consolidated Statement ofChanges in
Shareholders Equity
67 Notes to the Consolidated Financial
Statements
Company Financial Statements 2012
118 Company Statement ofFinancial Position
119 Company Income Statement
120 Notes to the Company Financial
Statements
Other Information
127 Proposed profit appropriation
127 Proposed appropriation ofresult
128 Independent auditors report
129 Glossary

Annual Report 2012
61
Consolidated Financial Statements
Consolidated Income Statement
2012
Notes
Before
specific
items
Specific
items
EURm
EURm
3, 4
5, 10, 18
13 372
(9 264)
(653)
Gross profit
5, 10
5, 10
5, 10
Other income
7
Other expenses
7, 9, 20, 31
4 108
(1 908)
(885)
(453)
105
(145)
(653)
(208)
(382)
(242)
(78)
822
(1 563)
2011
2010
Before
specific
items
Specific
items
EURm
EURm
EURm
13 372
(9 917)
13 645
(9 886)
(51)
3 455
(2 116)
(1 267)
(695)
105
(223)
3 759
(1 969)
(990)
(497)
92
(60)
(51)
(107)
(330)
(37)
(19)
(741)
8
15
(123)
(199)
335
(544)
15, 33
11
11
11
12
(1 040)
(342)
(377)
(234)
(867)
(164)
(1 382)
(611)
(1 031)
(63)
(87)
(58)
Loss for the year
(1 445)
(698)
(1 089)
Attributable to:
Equity holders of the parent
Non-controlling interests
(1 463)
18
(710)
12
(1 090)
1
(1 445)
(698)
(1 089)
Net sales
Cost of sales
Operating profit/(loss)
Financial income
Financial expenses
Other financial results
Loss before tax
Income tax expense
Loss for the year from continuing
operations
Loss for the year from discontinued
operations
31
For an analysis of specific items, refer to Note 2, Specific items.

The notes are an integral part of these consolidated financial statements.
62
Total
Before
specific
items
Specific
items
EURm
EURm
EURm
13 645
(9 937)
12 206
(8 767)
(174)
12 206
(8 941)
3 708
(2 076)
(1 320)
(534)
92
(79)
3 439
(1 804)
(992)
(459)
97
(115)
(174)
(212)
(307)
(76)
(27)
3 265
(2 016)
(1 299)
(535)
97
(142)
(209)
(17)
15
(108)
(58)
166
(796)
(630)
11
14
(157)
(105)
Total
Total
EURm
Consolidated Statement of Comprehensive Income
Loss for the year

Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Translation differences
Cash flow hedges
Available-for-sale investments
Share of other comprehensive income of associates
Other increase
Income tax related to components of other comprehensive income
Notes
2012
2011
EURm
EURm
2010
EURm
(1 445)
(698)
(1 089)
(6)
94
47
17
(1)
(2)
1
3
88
(99)
2
17
92
65
Total comprehensive loss for the year
(1 353)
(633)
(1 081)
Attributable to:
Equity holders of the parent
(1 372)
19
(652)
19
(1 097)
16
Total comprehensive loss for the year
(1 353)
(633)
(1 081)
Total comprehensive loss attributable to equity shareholders arises from:

Continuing operations
(1 309)
(63)
(565)
(87)
(1 039)
(58)
(1 372)
(652)
(1 097)
Other comprehensive income for the year, net of tax
21
22
22
15, 21
21, 22
Annual Report 2012
63
Consolidated Statement of Financial Position
December 31
2012
2011
EURm
EURm
182
387
509
31
470
63
29
173
699
641
28
587
85
23
1 671
2 236
18
16, 20, 32, 34
19
16, 34
16, 17, 34
16, 34
16, 34
984
4 111
879
37
165
2
2 418
1 275
5 215
1 051
54
61
13
1 613
31
8 596
143
9 282
57
10 410
11 575
0
9 744
133
75
(7 626)
0
9 744
136
(19)
(6 163)
2 326
126
3 698
116
Total equity
2 452
3 814
821
29
303
118
366
32
106
125
1 271
629
ASSETS
Non-current assets
Goodwill
Other intangible assets
Property, plant and equipment
Investments in associates and other companies
Deferred tax assets
Long-term loans receivable
Current assets
Inventories
Accounts receivable, net of allowances for doubtful accounts
Prepaid expenses and accrued income
Current portion of long-term loans receivable
Other financial assets
Available-for-sale investments, liquid assets
Cash and cash equivalents
Assets of disposal groups classified as held for sale
Notes
8, 9, 13
13
14
15
26
16, 34
16
Total assets
EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Share capital
Share premium
Fair value and other reserves
Accumulated deficit
Non-current liabilities
Long-term interest-bearing liabilities
Deferred tax liabilities
Provisions
Other long-term liabilities
23
23
21
22
16, 24, 34
26
28
6
Current liabilities
Current portion of long-term interest-bearing liabilities
Short-term borrowings
Other financial liabilities
Accounts payable
Accrued expenses
Provisions
16, 24, 32, 34

16, 24, 32, 34
16, 17, 34
16, 32, 34
25, 27
28
195
124
26
2 352
3 184
716
357
888
97
2 209
2 985
435
Liabilities of disposal groups classified as held for sale
31
6 597
90
6 971
161
7 958
7 761
10 410
11 575
Total liabilities
Total equity and liabilities
64
Consolidated Statement of Cash Flows
2012
2011
2010
EURm
EURm
EURm
(1 445)
(698)
(1 089)
1 162
587
347
307
64
57
711
239
151
28
140
843
170
248
31
51
87
(10)
86
18
44
1 160
564
405
776
198
11
528
(44)
(468)
852
(209)
(415)
Cash from operations

Interest received
Interest paid
Other financial income and expenses, net (paid)/received
Income taxes paid
2 145
11
(134)
(136)
(258)
580
9
(104)
30
(191)
633
5
(102)
(329)
(204)
Net cash from operating activities
1 628
324
64
10
(216)
(125)
6
(781)
2
(9)
82
(303)
(4)
24
(5)
(4)
22
(6)
46
(306)
(21)
30
(261)
(989)
(244)
1
(264)
(244)
(13)
1 000
(48)
232
(29)
15
414
(5)
229
(12)
Net cash (used in)/from financing activities
(520)
1 155
641
Foreign exchange adjustments

Net increase in cash and cash equivalents
(42)
805
(75)
415
38
438
Cash and cash equivalents at beginning of year
1 613
1 198
760
Cash and cash equivalents at end of year
2 418
1 613
1 198
1 712
706
729
884
757
441
2 418
1 613
1 198
Cash flows from operating activities

Loss for the year
Adjusted for:
Restructuring and other specific items (Note 2)1
Depreciation and amortization (Note 10)
Income taxes (Notes 12 & 31)
Financial income and expenses (Note 11)
Transfer from hedging reserve to sales and cost of sales (Note 22)
Profit/(Loss) on sale of property, plant and equipment,
businesses and Group companies
Other adjustments
Change in net working capital:
Decrease in current receivables
Decrease/(increase) in inventories
Increase/(decrease) in interest-free liabilities2
Cash flows from investing activities

Acquisition of Group companies, net of acquired cash
Purchase of shares in associates
Proceeds from current available-for-sale investments, liquid assets
Purchase of non-current available-for-sale investments
Proceeds from short-term and other long-term loans receivable
Purchases of property, plant and equipment, and intangible assets
Payments for disposal of businesses (Note 8) and Group companies
Proceeds from sale of property, plant and equipment, and intangible assets
Notes
33
33
33
Net cash used in investing activities

Cash flows from financing activities
Proceeds from issuance of cumulative preferred shares
Proceeds from long-term interest-bearing liabilities
Repayment of long-term interest-bearing liabilities
(Repayments of)/proceeds from short-term borrowings
Dividends paid to non-controlling interests
Cash and cash equivalents comprise:

Bank and cash
Current available-for-sale investments, cash equivalents
23
24, 34
16, 34
Excludes PPA related charges, divestment results and impairments which are presented in other line items in the above adjustments section or in Note 33, Notes to the
consolidated statement of cash flows.
2
Includes changes in the following line items in the statement of financial position: accounts payable, accrued expenses, provisions and other short-term liabilities.
1
In 2010, EUR 1 500 million loans and capitalized interest of EUR 32 million from the Groups parent companies were converted into preferred shares in Nokia Siemens
Networks B.V. This is the only material non-cash transaction in all three periods presented.
The figures in the consolidated statement of cash flows cannot be directly traced from the statement of financial position without additional information as a result
ofacquisitions and disposals of subsidiaries and net foreign exchange differences arising on consolidation.

Annual Report 2012
65
Consolidated Statement of Changes in Shareholders Equity
Attributable to owners of the parent
EURm
Notes
Balance at January 1, 2010

(Loss)/profit
Cash flow hedges, net of tax
Currency translation differences,
net of tax
Other increase, net of tax
Total comprehensive income/
(expense) for the year
Cumulative preference shares issued
Dividend
Additional parent contribution
Changes in ownership interests in
subsidiaries
Number
of
ordinary
shares
Fair value
Before
Number of
and
AccunonNoncumulative Ordinary
Share Translation
other mulated controlling controlling
preference
share
deficit
interests
interests
shares
capital1 premium differences reserves
100 073
7 194
22
23
300
119 3 094
1 (1 089)
(85)
(85)
(1 088)
(85)
(78)
(75)
98
(38) (5 454)
3 350
(710)
(710)
15
3
100 073
300
8 744
20
(1)
40
(2)
1
38
200
(1 097)
1 532
15
19
9 744
136
Ordinary share capital comprises EUR 400 thousand of ordinary shares of the Group.
9 744
(698)
20
(1)
47
(2)
1
116 3 814
(1 463)
(1 463)
18 (1 445)
94
94
(7)
12
3 698
500
(83)
(19) (6 163)
(7)
100 073
(8)
95 3 445
(652)
1 000
94
Total comprehensive (expense)/

income for the year
Dividend
16 (1 081)
1 532
(32)
(32)
15
(2)
1
500
91
2
(709)
1 000
8
100 073
15
20
(1)
40
23
76
2
76
1 532
(Loss)/profit
22
Available-for-sale investments, net of tax 22
netoftax
21
Share of other comprehensive income
of associates
15, 21
Other decrease, net of tax
2 975
(1 090)
Balance at December 31, 2011
66
(4 288)
(1 090)
76
(Loss)/profit
22
Available-for-sale investments, net of tax 22
netoftax
21
of associates
15, 21
Other increase, net of tax
47
(85)
21
Total comprehensive income/

(expense) for the year
Cumulative preference shares issued
Dividend
Acquisitions and other changes in
non-controlling interests
22
Total
19
(633)
1 000
(15)
(15)
17
17
(6)
(3)
94
(1 463)
(1 372)
19 (1 353)
(9)
(9)
133
75
(7 626)
2 326
126 2 452
1 Accounting principles
General
Nokia Siemens Networks B.V., a limited liability company incorporated
and domiciled in The Hague, the Netherlands, is the holding
company for all its subsidiaries (Nokia Siemens Networks or the
Group). The Groups operational headquarters are in Espoo, Finland.
The Group is a leading global provider of telecommunications
infrastructure, with a focus on the mobile broadband market.
Basis of presentation
The consolidated financial statements of Nokia Siemens Networks
are prepared in accordance with International Financial Reporting
Standards as issued by the International Accounting Standards
Board (IASB) and in conformity with IFRS as adopted by the
European Union (IFRS). The consolidated financial statements are
presented in millions of euro (EURm), except as otherwise noted,
and are prepared under the historical cost convention, except as
disclosed in the accounting policies below.
The Group commenced operations on April 1, 2007 upon the
contribution of certain tangible and intangible assets and certain
business interests that comprised Nokia Corporations (Nokia)
networks business and Siemens Aktiengesellschaft (Siemens)
carrier-related operations. Nokia and Siemens (the parent
companies) each own approximately 50% of Nokia Siemens
Networks. Nokia is incorporated in Espoo, Finland and Siemens is
incorporated in Munich, Germany. Nokia has the ability to appoint
the Chief Executive Officer (CEO) of the Group and the majority of
the members of the Board of Directors. Accordingly, for accounting
purposes, Nokia is deemed to have control and thus consolidates
the results of Nokia Siemens Networks in its financial statements.
Siemens accounts for its ownership using the equity method of
accounting. On March 17, 2013 the Board of Directors of Nokia
Siemens Networks B.V. authorized the financial statements for
issuance.
This paragraph is included in connection with statutory reporting
requirements in the Netherlands. The company income statement of
the Parent company is prepared in compliance with section 2:402 of
the Netherlands Civil Code.
This paragraph is included in connection with statutory reporting
requirements in Germany. The fully consolidated German
subsidiaries, Nokia Siemens Networks GmbH & Co. KG, registered
in the commercial register of Munich under HRA 88537 and Nokia
Siemens Networks Services GmbH & Co. KG, registered in the
commercial register of Munich under HRA 90646 have made use of
the exemption available under 264b of the German Commercial
Code (HGB).
Adoption of pronouncements under IFRS

In the current year, the Group has adopted the following new and
revised standards, and amendments and interpretations to existing
standards issued by the IASB that are relevant to its operations
andeffective for accounting periods commencing on or after
January 1, 2012:
Amendments to IAS 1, Presentation of Financial Statements,
retains the one or two statement approach at the option of the
entity and only revises the way other comprehensive income is
presented; separate subtotals are required for those elements
which may be recycled and those elements that will not be
recycled.
Amendments to IAS 12, Income Taxes, provides clarification for
themeasurement of deferred taxes in situations where an asset
ismeasured using the fair value model in IAS 40, Investment
Property, by introducing a presumption that the carrying amount
ofthe underlying asset will be recovered through sale.
In addition, a number of other amendments that form part of the
IASBs annual improvement project were adopted by the Group.
Theadoption of each of the above amendments did not have a
material impact on the consolidated financial statements.
Principles of consolidation
The consolidated financial statements include the accounts of Nokia
Siemens Networks B.V. as the parent company (the Parent), and
each of those companies over which the Group exercises control.
Control over an entity exists when the Group owns, directly or
indirectly through subsidiaries, more than 50% of the voting rights of
the entity, the Group has the power to govern the operating and
financial policies of the entity through agreement or the Group has
the power to appoint or remove the majority of the members of the
board of directors of the entity.
The Groups share of profits and losses of associates is included in
the consolidated comprehensive income statement in accordance
with the equity method of accounting. After the carrying amount of
the investors interest is reduced to nil, losses continue to be
recognized, when it is considered that a constructive obligation
exists. An associate is an entity over which the Group exercises
significant influence. Significant influence exists when the Group
owns, directly or indirectly through subsidiaries, more than 20%
ofthe voting rights of the company. If the Group owns, directly or
indirectly through subsidiaries, less than 20% of the voting rights of
the company, it is presumed that the Group does not have significant
influence, unless such influence can be clearly demonstrated.
All intercompany transactions are eliminated as part of the
consolidation process. Non-controlling interests are presented
separately as a component of net profit and are shown as a
component of shareholders equity in the consolidated statement
offinancial position.
The entities or businesses acquired during the financial periods
presented have been consolidated from the date on which control
ofthe net assets and operations was transferred to the Group.
Similarly, the results of Group entities or businesses divested during
an accounting period are included in the Group consolidated
financial statements only to the date of disposal.
Annual Report 2012
67
Business combinations
The acquisition method of accounting is used to account for
acquisitions of separate entities or businesses by the Group. The
consideration transferred in a business combination is measured as
the aggregate of the fair values of the assets transferred, liabilities
incurred towards the former owners of the acquired business and
equity instruments issued. Acquisition-related costs are recognized
as expenses in the income statement in the period in which the costs
are incurred and the related services are received. Identifiable assets
acquired and liabilities assumed by the Group are measured
separately at their fair value at the acquisition date. Non-controlling
interests in the acquired business are measured separately at fair
value or at the non-controlling interests proportionate share of the
identifiable net assets of the acquired business. The excess of the
aggregate consideration transferred over the acquisition date fair
values of the identifiable net assets acquired is recorded as goodwill.
Non-current assets and disposal groups held for sale
Non-current assets and disposal groups are classified as held for
sale when the carrying amount is expected to be recovered
principally through a sale transaction rather than through continuing
use. These assets, or in the case of disposal groups, assets and
liabilities, are presented separately in the consolidated statement of
financial position and measured at the lower of the carrying amount
and fair value less costs to sell. Non-current assets classified as held
for sale, or included in a disposal group that is classified as held for
sale, are not depreciated.
Assessment of the recoverability of long-lived assets,
intangible assets and goodwill
For purposes of impairment testing, goodwill has been allocated to
each of the cash-generating units or groups of cash-generating units
(CGUs), expected to benefit from the synergies of the combination.
The Group assesses the carrying value of goodwill annually or more
frequently if events or changes in circumstances indicate that such
carrying value may not be recoverable. The carrying value of
identifiable intangible assets and long-lived assets is assessed if
events or changes in circumstances indicate that such carrying
value may not be recoverable. Factors that trigger an impairment
review include, but are not limited to, underperformance relative to
historical or projected future results, significant changes in the
manner of the use of the acquired assets or the strategy for the
overall business and significant negative industry or economic trends.
The Group conducts its impairment testing by determining the
recoverable amount for the asset or cash-generating unit. The
recoverable amount of an asset or a cash-generating unit is the
higher of its fair value less costs to sell and its value-in-use. The
recoverable amount is then compared to the assets carrying
amount and an impairment loss is recognized if the recoverable
amount is less than the carrying amount. Impairment losses are
recognized immediately in the income statement.
68
Disposals of separate entities or businesses

If upon disposal, the Group loses control of a separate entity or
business, it records a gain or loss on disposal at the date when
control is lost. The gain or loss on disposal is calculated as the
difference between the fair value of the consideration received and
the carrying amounts of derecognized assets (including any
goodwill) and liabilities of the disposed entity or business, and the
carrying amount of any non-controlling interest in the entity, adjusted
by amounts recognized in other comprehensive income in relation to
that entity or business.
Segment information
Operating segments have been determined by reference to the
internal reporting information provided to the chief operating
decision-maker, who is responsible for allocating resources and
assessing the performance of the operating segments. In 2012, the
chief operating decision-maker was a group of executive officers
comprising the Chief Executive Officer, the Chief Financial Officer
and the Chief Operating Officer.
Foreign currency translation
Functional and presentation currency
The financial statements of the majority of the Groups entities are
measured using the currency of the primary economic environment
in which the entity operates (functional currency). The consolidated
financial statements are presented in euro, which is the functional
and presentation currency of the Parent.
Transactions in foreign currencies
Transactions in foreign currencies are recorded at the rates of
exchange prevailing at the dates of the individual transactions. For
practical reasons, a rate that approximates the actual rate at the date
of the transaction is often used. At the end of an accounting period,
the unsettled balances on foreign currency monetary assets and
liabilities are valued at the rates of exchange prevailing at the end of
the accounting period. Foreign exchange gains and losses arising
from statement of financial position items and the fair value changes
in the related hedging instruments are reported in financial income
and expenses. For non-current available-for-sale investments, such
as shares, the unrealized foreign exchange gains and losses are
recognized in other comprehensive income.
Foreign group companies
In the consolidated financial statements, all income and expenses
offoreign group companies, where the functional currency is other
than euro, are translated into euro at the average foreign exchange
rates for the accounting period. All assets and liabilities of foreign
group companies are translated into euro at the foreign exchange
rates at the end of the accounting period. Differences resulting from
the translation of income and expenses at the average rate and
assets and liabilities at the closing rate are recognized as translation
differences in other comprehensive income. On the disposal of all
orpart of a foreign group company by sale, liquidation, repayment
ofshare capital or abandonment, the cumulative amount or
proportionate share of the translation difference is recognized as
income or expense in the same period in which the gain or loss on
disposal is recognized.
Foreign group companies in hyperinflationary economies

The financial statements of foreign group companies, where the
functional currency is the currency of a hyperinflationary economy,
are adjusted to reflect changes in general purchasing power. In such
instances, non-monetary items in the statement of financial position
and all items in the income statement should be expressed in terms
of the measuring unit current at the end of the accounting period.
These items are restated through the application of a general price
index. The comparatives, which were presented as current year
amounts in the prior-year financial statements in a stable currency
(i.e. not a currency of a hyperinflationary economy), are not restated.
After the financial statements have been restated in the current
purchasing power, all amounts for the current period are then
translated into the stable currency at the closing rate for inclusion in
the consolidated financial statements. Inflationary gains and losses
on the net monetary position are recognized as gains and losses in
the income statement.
Revenue recognition
The majority of the Groups sales are recognized when the significant
risks and rewards of ownership have transferred to the buyer,
continuing managerial involvement usually associated with
ownership and effective control have ceased, the amount of revenue
can be measured reliably, it is probable that the economic benefits
associated with the transaction will flow to the Group and the costs
incurred or to be incurred in respect of the transaction can be
measured reliably. The Group accounts for special pricing
agreements and other volume-based discounts as a reduction
inrevenue.
Service revenue, which typically includes managed services and
maintenance services, is generally recognized on a straight-line
basis over the specified period unless there is evidence that some
other method better represents the rendering of services.
The Group enters into transactions involving multiple components
consisting of any combination of hardware, services and software.
The commercial effect of each separately identifiable component of
the transaction is evaluated in order to reflect the substance of the
transaction. Revenue is allocated to each component based on its
relative fair value. The Group determines the fair value of each
component by taking into consideration factors such as the price
when the component, or a similar component is sold separately by
the Group or a third party. The revenue allocated to each component
is recognized when the revenue recognition criteria for that
component have been met.
In addition, sales from contracts involving solutions achieved
through the modification of complex telecommunications equipment
are recognized using the percentage of completion method when
the outcome of the contract can be estimated reliably. A contracts
outcome can be estimated reliably when total contract revenue and
the costs to complete the contract can be estimated reliably, it is
probable that the economic benefits associated with the contract will
flow to the Group and the stage of contract completion can be
measured reliably. When the Group is not able to meet one or more
of those conditions, the policy is to recognize revenue only equal to
costs incurred to date, to the extent that such costs are expected to
be recovered.
Progress towards completion is measured by reference to cost

incurred to date as a percentage of estimated total project costs,
using the cost-to-cost method. The percentage of completion
method relies on estimates of total expected contract revenue and
costs, as well as dependable measurement of the progress made
towards completing a particular project. Recognized revenues and
profits are subject to revisions during the project in the event that the
assumptions regarding the overall project outcome are revised.
Thecumulative impact of a revision in estimates is recorded in the
period such revisions become probable and can be estimated
reliably. Losses on projects in progress are recognized in the period
they become probable and can be estimated reliably.
Shipping and handling costs
The costs of shipping and distributing products are included in cost
of sales.
Research and development
Research and development costs are expensed as incurred, except
for certain development costs, which are capitalized when it is
probable that a development project will generate future economic
benefits and certain criteria, including commercial and technological
feasibility, have been met. Capitalized development costs,
comprising direct labor and related overhead, are amortized on a
systematic basis over their expected useful lives of between two and
five years.
Capitalized development costs are subject to regular assessments
of recoverability based on anticipated future revenues, including the
impact of changes in technology. Unamortized capitalized
development costs determined to be in excess of their recoverable
amounts are expensed immediately.
Acquired patents, trademarks, licenses, software licenses for
internal use, customer relationships and developed technology are
capitalized and amortized using the straight-line method over their
useful lives, generally three to seven years. Where an indication of
impairment exists, the carrying amount of the related intangible
asset is assessed for recoverability. Any resulting impairment losses
are recognized immediately in the income statement.
Employee benefits
Pensions
The Group companies have various pension schemes in
accordance with the local conditions and practices in the countries
in which they operate. The schemes are generally funded through
payments to insurance companies or to trustee-administered funds
as determined by periodic actuarial calculations.
In a defined contribution plan, the Groups legal or constructive
obligation is limited to the amount that it agrees to contribute to the
fund. The Groups contributions to defined contribution plans are
recognized in the income statement in the period to which the
contributions relate. All arrangements that do not fulfill these
conditions are considered defined benefit plans.
Annual Report 2012
69
For defined benefit plans, pension costs are assessed using the
projected unit credit method: the pension cost is recognized in the
income statement so as to spread the service cost over the service
lives of employees. The pension obligation is measured as the
present value of the estimated future cash outflows using interest
rates on high quality corporate bonds or government bonds with
appropriate maturities. Actuarial gains and losses outside the
corridor are recognized over the average remaining service lives of
employees. The corridor is defined as 10% of the greater of the value
of plan assets and defined benefit obligation at the beginning of the
respective year.
Past service costs are recognized immediately in the income
statement, unless the changes to the pension plan are conditional
on the employees remaining in service for a specified period of time
(the vesting period). In this case, the past service costs are amortized
on a straight-line basis over the vesting period.
The liability (or asset) recognized in the statement of financial position
is the pension obligation at the closing date less the fair value of plan
assets, the share of unrecognized actuarial gains and losses and
past service costs. Any net pension asset is limited to unrecognized
actuarial losses, past service cost, the present value of available
refunds from the plan and expected reductions in future
contributions to the plan.
Actuarial valuations for the Groups defined benefit pension plans are
performed annually. In addition, actuarial valuations are performed
when a material curtailment or settlement of a defined benefit plan
occurs in the Group.
Termination benefits are payable when employment is terminated
before the normal retirement date, or whenever an employee
accepts voluntary redundancy in exchange for these benefits. The
Group recognizes termination benefits when it is demonstrably
committed to either terminating the employment of current
employees according to a detailed formal plan without possibility of
withdrawal, or providing termination benefits as a result of an offer
made to encourage voluntary redundancy.
Property, plant and equipment are stated at cost less accumulated
depreciation. Depreciation is recorded on a straight-line basis over
the expected useful lives of the assets as follows:
Buildings and constructions
Industrial and office buildings
Light buildings and constructions
20 33 years
3 20 years
Machinery and equipment

Production machinery, measuring
and test equipment
Other machinery and equipment
1 5 years
3 10 years
Land and water areas are not depreciated.
70
Maintenance, repairs and renewals are generally expensed in the

period in which they are incurred. However, major renovations are
capitalized and included in the carrying amount of the asset when it
is probable that future economic benefits in excess of the originally
assessed standard of performance of the existing asset will flow to
the Group. Major renovations are depreciated over the remaining
useful life of the related asset. Leasehold improvements are
depreciated over the shorter of the lease term or useful life. Gains
and losses on the disposal of property, plant and equipment are
included in operating profit or loss.
Leases
Leases are classified as finance leases whenever the terms of the
lease transfer substantially all the risks and rewards of ownership to
the lessee. All other leases are classified as operating leases.
The Group has entered into various operating lease contracts. The
related payments are treated as rental expenses and recognized in
the income statement on a straight-line basis over the lease terms
unless another systematic approach is more representative of the
time pattern of the Groups benefit.
Inventories
Inventories are stated at the lower of cost and net realizable value.
Cost is determined using standard cost, which approximates actual
cost on a FIFO (first-in, first-out) basis. Net realizable value is the
amount that can be realized from the sale of the inventory in the
normal course of business after allowing for the costs of realization.
In addition to the cost of materials and direct labor, an appropriate
proportion of production overhead is included in the inventory
values. An allowance is recorded for excess inventory and
obsolescence based on the lower of cost and net realizable value.
Financial assets
The Group has classified its financial assets as one of the following
categories: available-for-sale investments, derivative and other
current financial assets, loans receivable, accounts receivable or
cash and cash equivalents. Derivatives are described below in the
section on Derivative financial instruments. Derivatives and other
current financial assets are presented in Note 16, Fair value
offinancial instruments.
The Group invests a portion of cash needed to cover the projected
cash needs of its ongoing operations in highly liquid, interest-bearing
investments. The following investments are classified as availablefor-sale based on the purpose for acquiring the investments and the
Groups ongoing intentions: (1) Highly liquid, fixed income and
money-market investments that are readily convertible to known
amounts of cash with maturities at acquisition of three months or
less, which are included in cash and cash equivalents in the
statement of financial position. Due to the high credit quality and
short-term nature of these investments there is an insignificant risk of
changes in value. (2) Similar types of investments as in category (1),
but with maturities at acquisition of longer than three months,
classified in the statement of financial position as current availablefor-sale investments, liquid assets. (3)Investments in technology
related publicly quoted equity shares,or unlisted private equity
shares and unlisted funds, are classified in the statement of financial
position as non-current available-for-sale investments.
Current fixed income and money-market investments are fair valued

by using quoted market rates, discounted cash flow analyses and
other appropriate valuation models at the statement of financial
position date. Investments in publicly quoted equity shares are
measured at fair value using exchange quoted bid prices. Other
available-for-sale investments carried at fair value include holdings in
unlisted shares. Fair value is estimated by using various factors,
including, but not limited to: (1) the current market value of similar
instruments, (2) prices established from a recent arms length
financing transaction of the target companies, (3) analysis of market
prospects and operating performance of the target companies
taking into consideration public market comparable companies in
similar industry sectors. The remaining available-for-sale
investments, which are technology-related investments in private
equity shares and unlisted funds for which the fair value cannot be
measured reliably due to non-existence of public markets or reliable
valuation methods against which to value these assets, are carried at
cost less impairment.
All purchases and sales of investments are recorded on the trade
date, which is the date that the Group commits to purchase or sell
the asset.
The fair value changes of available-for-sale investments are
recognized in fair value and other reserves as part of other
comprehensive income, with the exception of interest calculated
using the effective interest method and foreign exchange gains and
losses on monetary assets, which are recognized directly in the
income statement. Dividends on available-for-sale equity
instruments are recognized in the consolidated income statement
when the Groups right to receive payment is established. When the
investment is disposed of, the related accumulated fair value
changes are released from other comprehensive income and
recognized in the income statement. The weighted average method
is used when determining the cost basis of publicly listed equities
being disposed of by the Group. The FIFO method is used to
determine the cost basis of fixed income securities being disposed
of by the Group. An impairment is recorded when the carrying
amount of an available-for-sale investment is greater than the
estimated fair value and there is objective evidence that the asset is
impaired. The cumulative net loss relating to that investment is
removed from equity and recognized in the income statement for the
period. If, in a subsequent period, the fair value of the investment in a
non-equity instrument increases and the increase can be objectively
related to an event occurring after the loss was recognized, the loss
is reversed, with the amount of the reversal included in the income
statement.
Loans receivable
Loans receivable include loans to customers and are measured
initially at fair value and subsequently at amortized cost less
impairment using the effective interest method. Loans are subject to
regular review as to their collectability and available collateral. In the
case that a loan is deemed not fully recoverable, a provision is made,
and included in other operating expenses to reflect the shortfall
between the carrying amount and the present value of the expected
cash flows. Interest income on loans receivable is recognized in the
income statement in other income or financial income depending on
the nature of the receivable by applying the effective interest rate.
The long-term portion of loans receivable is included in the
statement of financial position in long-term loans receivable and the
current portion in current portion of long-term loans receivable.
Accounts receivable
Accounts receivable include both amounts invoiced to customers
and amounts where the Groups revenue recognition criteria have
been fulfilled but the customers have not yet been invoiced.
Accounts receivable are carried at amortized cost using the effective
interest rate method less allowances for doubtful accounts.
Allowances for doubtful accounts are based on a periodic review of
all outstanding amounts, including an analysis of historical bad debt,
customer concentrations, customer creditworthiness, current
economic trends and changes in customer payment terms.
Baddebts are written off when identified as uncollectible and are
included in other expenses. The Group derecognizes an accounts
receivable balance only when the contractual rights to the cash flows
from the asset expire or it transfers the financial asset and
substantially all the risks and rewards of ownership of the asset to
another entity.
Bank and cash consist of cash at bank and in hand. Cash
equivalents consist of highly liquid available-for-sale investments
purchased with remaining maturities at the date of acquisition of
three months or less.
Financial liabilities
Loans payable
Loans payable are recognized initially at fair value, net of transaction
costs incurred. In subsequent periods, loans are stated at amortized
cost using the effective interest method. The long-term portion of
loans payable is included in the statement of financial position in
long-term interest-bearing liabilities and the current portion in the
current portion of long-term interest-bearing liabilities.
Interest costs are recognized in the income statement as financial
expenses in the period in which they are incurred.
Accounts payable
Accounts payable are carried at the original invoiced amount which
is considered to be fair value due to the short-term nature of the
Groups accounts payable.
Derivative financial instruments
All derivatives are recognized initially at fair value on the date a
derivative contract is entered into and are subsequently remeasured
at fair value. The method of recognizing the resulting gain or loss
varies according to whether the derivatives are designated and
qualify under hedge accounting. Generally the cash flows of ahedge
are classified as cash flows from operating activities in the
consolidated statement of cash flows as the underlying hedged
items relate to the Groups operating activities. When a derivative
contract is accounted for as a hedge of an identifiable position
relating to financing or investing activities, the cash flows of the
contract are classified in the same manner as the cash flows of the
position being hedged.
Annual Report 2012
71
Derivatives not designated in hedge accounting relationships

carried at fair value through profit and loss
Fair values of cash-settled equity derivatives are calculated based
onquoted market rates at each statement of financial position date.
Changes in fair value are recognized in the income statement.
Fair values of forward rate agreements, interest rate options, futures
contracts and exchange traded options are calculated based on
quoted market rates at each statement of financial position date.
Discounted cash flow analyses are used to value interest rate and
currency swaps. Changes in the fair value of these contracts are
recognized in the income statement.
Forward foreign exchange contracts are valued at the market
forward exchange rates. Changes in fair value are measured by
comparing these rates with the original contract forward rate.
Currency options are valued at each statement of financial position
date by using the Garman & Kohlhagen option valuation model.
Changes in the fair value of these instruments are recognized in
theincome statement.
For derivatives not designated under hedge accounting but hedging
identifiable exposures such as anticipated foreign currency
denominated sales and purchases, the gains and losses are
recognized in other income or expenses. The gains and losses
onallother derivatives not designated under hedge accounting are
recognized in financial income and expenses (refer to Note 11,
Financial income and expenses).
Embedded derivatives, if any, are identified and monitored by the
Group and measured at fair value at each statement of financial
position date with changes in fair value recognized in the income
statement.
Hedge accounting
The Group uses hedge accounting in respect of certain forward
foreign exchange contracts and options, or option strategies which
have zero net premium or a net premium paid, and where the critical
terms of the bought and sold options within a collar or zero premium
structure are the same and where the nominal amount of the sold
option component is no greater than that of the bought option.
Cash flow hedges: Hedging of forecast foreign currency
denominated sales and purchases
The Group applies hedge accounting for Qualifying hedges.
Qualifying hedges are those properly documented cash flow hedges
of the foreign exchange rate risk of future forecast foreign currency
denominated sales and purchases that meet the requirements set
out in IAS 39, Financial Instruments: Recognition and Measurement.
The hedged item must be highly probable and must present an
exposure to variations in cash flows that could ultimately affect profit
or loss. The hedge must be highly effective, both prospectively and
retrospectively.
For qualifying foreign exchange forwards, the change in fair value
that reflects the change in spot exchange rates is deferred in fair
value and other reserves to the extent that the hedge is effective. For
qualifying foreign exchange options or option strategies, the change
in intrinsic value is deferred in fair value and other reserves to the
extent that the hedge is effective. In all cases the ineffective portion is
recognized immediately in the income statement in financial income
and expenses (refer to Note 11, Financial income and expenses).
Hedging costs, either expressed as the change in fair value that
72
reflects the change in forward exchange rates less the change in

spot exchange rates for forward foreign exchange contracts, or
changes in the time value for options, or options strategies are
recognized in other income or expenses.
Accumulated fair value changes from qualifying hedges are released
from fair value and other reserves into the income statement as
adjustments to sales and cost of sales in the period when the
hedged item affects the income statement. Forecast foreign
currency sales and purchases affect profit and loss at various dates
up to approximately 15 months from the statement of financial
position. If the forecasted transaction is no longer expected to take
place, all deferred gains or losses are released immediately into the
income statement as adjustments to sales and cost of sales. If the
hedged item ceases to be highly probable but is still expected to take
place, accumulated gains and losses remain in equity until the
hedged cash flow affects the income statement.
Cash flow hedges: Hedging of foreign currency risk of highly
probable business acquisitions
The Group hedges the cash flow variability due to foreign currency
risk inherent in highly probable business acquisitions that result in
the recognition of non-financial assets. When those assets are
recognized in the statement of financial position, the gains and
losses previously deferred in fair value and other reserves are
transferred from fair value and other reserves and included in the
initial acquisition cost of the asset. In order to apply for hedge
accounting, the forecasted transactions must be highly probable
and the hedges must be highly effective prospectively and
retrospectively.
Cash flow hedges: Hedging of cash flow variability on variable
rate liabilities
The Group applies cash flow hedge accounting for hedging cash
flow variability on certain variable rate liabilities. The effective portion
of the gain or loss relating to interest rate swaps hedging variable rate
borrowings is deferred in fair value and other reserves. The gain or
loss relating to the ineffective portion is recognized immediately in
the income statement in financial income and expenses (refer to
Note 11, Financial income and expenses). For hedging instruments
settled before the maturity date of the related liability, hedge
accounting will immediately discontinue from that date onwards,
with all the cumulative gains and losses on the hedging instruments
recycled gradually to the income statement in financial income and
expenses (refer to Note 11, Financial income and expenses) when
the hedged variable interest cash flows affect the income statement.
Income taxes
The tax expense comprises current tax and deferred tax. Current
taxes are based on the results of the Group companies and are
calculated according to local tax rules. Tax is recognized in the
income statement except to the extent that it relates to items
recognized in other comprehensive income or directly in equity,
thenthe tax is recognized in other comprehensive income or equity,
respectively.
Deferred tax assets and liabilities are determined, using the liability
method, for all temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the
consolidated financial statements. Deferred tax assets are
recognized to the extent that it is probable that future taxable profit
will be available against which the unused tax losses or deductible
temporary differences can be utilized. When circumstances indicate
it is no longer probable that deferred tax assets will be utilized, they
are assessed for realizability and adjusted as necessary. Deferred
tax liabilities are recognized for temporary differences that arise
between the fair value and tax base of identifiable net assets
acquired in business combinations. Deferred tax assets and
deferred tax liabilities are offset for presentation purposes when
there is a legally enforceable right to set off current tax assets against
current tax liabilities, and the deferred tax assets and the deferred
tax liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entity or different taxable
entities which intend either to settle current tax liabilities and assets
on a net basis, or to realize the assets and settle the liabilities
simultaneously, in each future period in which significant amounts of
deferred tax liabilities or assets are expected to be settled or
recovered.
Project loss provisions

The Group provides for onerous contracts based on the lower of the
expected cost of fulfilling the contract and the expected cost of
terminating the contract.
The enacted or substantively enacted tax rates as of each statement

of financial position date that are expected to apply in the period
when the asset is realized or the liability is settled are used in the
measurement of deferred tax assets and liabilities.
Dividends
Dividends are recognized in the consolidated financial statements of
the Group when approved by the Board of Directors and by the
Annual General Meeting of the Shareholders in accordance with the
Articles of Association of Nokia Siemens Networks B.V.
Provisions
Provisions are recognized when the Group has a present legal or
constructive obligation as a result of past events, it is probable that
an outflow of resources will be required to settle the obligation and a
reliable estimate of the amount can be made. When the Group
expects a provision to be reimbursed, the reimbursement is
recognized as an asset only when the reimbursement is virtually
certain. The Group assesses the adequacy of its existing provisions
and adjusts the amounts as necessary based on actual experience
and changes in future estimates at each statement of financial
position date.
Warranty provisions
The Group provides for the estimated liability to repair or replace
products under warranty at the time revenue is recognized. The
provision is an estimate based on historical experience of the level of
repairs and replacements.
Tax provisions
The Group recognizes a provision for tax contingencies based upon
the estimated future settlement amount at each statement of
financial position date.
Restructuring provisions
The Group provides for the estimated cost to restructure when a
detailed formal plan of restructuring has been completed, approved
by management and the restructuring plan has been announced.
Restructuring costs consist primarily of personnel restructuring
charges. The other main components are costs associated with the
closure of manufacturing sites and exiting real estate locations,
divestment related charges and impairment charges.
Other provisions
The Group provides for other contractual obligations based on the
expected cost of executing any such contractual commitments.
Share-based payment
The Group established a share-based incentive program in 2012
under which options are granted to selected employees. The options
will be cash-settled at exercise unless certain corporate transactions
such as an initial public offering occur.
For cash-settled share-based payment transactions, the employee
services received and the liability incurred are measured at the fair
value of the liability. The fair value of the options is determined based
on the reporting date estimated value of shares less the exercise
price of the options. The fair value of the liability is remeasured at
each reporting date and at the date of settlement and the related
change in fair value is recognized in the income statement.
Use of estimates and critical accounting judgments

The preparation of financial statements in conformity with IFRS
requires the application of judgment by management in selecting
appropriate assumptions for calculating financial estimates which
inherently contain some degree of uncertainty. Management bases
its estimates on historical experience and various other assumptions
that are believed to be reasonable under the circumstances, the
results of which form the basis for making judgments about the
reported carrying values of assets and liabilities and the reported
amounts of revenues and expenses that may not be readily apparent
from other sources. Actual results may differ from these estimates
under different assumptions or conditions.
Set forth below are areas requiring significant judgment and
estimation that may have an impact on reported results and the
financial position.
Revenue recognition
The majority of the Groups sales are recognized when the significant
risks and rewards of ownership have transferred to the buyer,
continuing managerial involvement usually associated with
ownership and effective control have ceased, the amount of revenue
can be measured reliably, it is probable that the economic benefits
associated with the transaction will flow to the Group and the costs
incurred or to be incurred in respect of the transaction can be
measured reliably. Sales may materially change if managements
assessment of such criteria was determined to be inaccurate.
Annual Report 2012
73
The Group enters into transactions involving multiple components

consisting of any combination of hardware, services and software.
The commercial effect of each separately identifiable component of
the transaction is evaluated in order to reflect the substance of the
transaction. Revenue is allocated to each separately identifiable
component based on the relative fair value of each component. The
Group determines the revenue recognition method for each
component based on the scope of work, including the nature of the
services rendered. The revenue for each component is recognized
when the revenue recognition criteria for that component have been
met. Determination of the fair value for each component requires the
use of estimates and judgment taking into consideration factors
such as the price when the component is sold separately by the
Group or the price when a similar component is sold separately by
the Group or a third party, which may have a significant impact on
the timing and amount of revenue recognition.
Revenue from contracts involving solutions achieved through the
modification of complex telecommunications equipment is
recognized on the percentage of completion basis when the
outcome of the contract can be estimated reliably. Recognized
revenues and profits are subject to revisions during the project in the
event that the assumptions regarding the overall project outcome
are revised. Current sales and profit estimates for projects may
materially change due to the early stage of a long-term project, new
technology, changes in the project scope, changes in costs,
changes in timing, changes in customers plans, realization of
penalties, and other corresponding factors. Refer to Note 4 Revenue
recognition.
Customer financing
The Group has provided a limited number of customer financing
arrangements and agreed extended payment terms with selected
customers. Should the actual financial position of the customers or
general economic conditions differ from assumptions, the
collectability of such arrangements may be required to be reassessed, which could result in a write-off of these balances in future
periods. The Group endeavors to mitigate this risk through the
transfer of its rights to the cash collected from these arrangements to
third party financial institutions on a non-recourse basis in exchange
for an upfront cash payment. Refer to Note 16, Fair value of financial
instruments.
Allowances for doubtful accounts
The Group maintains allowances for doubtful accounts for estimated
losses resulting from the subsequent inability of customers to make
the required payments. If the financial conditions of customers were
to deteriorate, reducing their ability to make payments, additional
allowances may be required in future periods. Refer to Note 20,
Allowances for doubtful accounts.
Inventory-related allowances
The Group periodically reviews inventory for excess amounts,
obsolescence and declines in market value below cost and records
an allowance against the inventory balance for any such declines.
These reviews require management to estimate future demand for
products. Possible changes in these estimates could result in
revisions to the valuation of inventory in future periods. Refer to Note
18, Inventories.
74
Warranty provisions
The Group provides for the estimated cost of product warranties at
the time revenue is recognized. The Groups warranty provision is
established based upon best estimates of the amounts necessary to
settle future and existing claims on products sold as of each
statement of financial position date. As new products incorporating
complex technologies are continuously introduced, and as local
laws, regulations and practices may change, changes in these
estimates could result in additional allowances or changes to
recorded allowances required in future periods. Refer to Note 28,
Provisions.
Restructuring provisions
The Group provides for the estimated future cost related to
restructuring programs. The restructuring provision is based on
managements best estimate. Restructuring costs primarily relate to
personnel restructuring and changes in estimates of timing or
amounts of costs to be incurred may become necessary as the
restructuring program is implemented. Refer to Note 28, Provisions.
Business combinations
The Group applies the acquisition method of accounting to account
for acquisitions of separate entities or businesses. The consideration
transferred in a business combination is measured as the aggregate
of the fair values of the assets transferred, liabilities incurred towards
the former owners of the acquired business and equity instruments
issued. Identifiable assets acquired and liabilities assumed by the
Group are measured separately at their fair values as of the
acquisition date. The excess of the aggregate of the consideration
transferred over the acquisition date fair values of the identifiable net
assets acquired is recorded as goodwill.
The determination and allocation of fair values to the identifiable
assets acquired and liabilities assumed is based on various
assumptions and valuation methodologies requiring management
judgment. Actual results may differ from the forecasted amounts and
the difference could be material. Refer to Note 8, Acquisitions and
disposals.
Assessment of the recoverability of long-lived and intangible
assets and goodwill
The recoverable amounts for long-lived assets, intangible assets and
goodwill have been determined based on the expected future cash
flows attributable to the asset or cash-generating units discounted to
present value. The key assumptions applied in the determination of
the recoverable amount include the discount rate, length of the
explicit forecast period and estimated growth rates, profit margins
and level of operational and capital investment. Amounts estimated
could differ materially from what will actually occur in the future. Refer
to Note 9, Impairment.
Fair value of derivatives and other financial instruments
The fair value of financial instruments that are not traded in an active
market (for example, unlisted equities and embedded derivatives) is
determined using various valuation techniques. The Group uses
judgment to select an appropriate valuation methodology as well as
underlying assumptions based on existing market practice and
conditions. Changes in these assumptions may cause the Group to
recognize impairments or losses in future periods. Refer to Note 16,
Fair value of financial instruments, Note 17, Derivative financial
instruments and Note 34, Financial and capital risk management.
Income taxes
Management judgment is required in determining income tax
expense, tax provisions, deferred tax assets and liabilities and the
extent to which deferred tax assets can be recognized. When
circumstances indicate it is no longer probable that deferred tax
assets will be utilized, they are assessed for realizability and adjusted
as necessary. If the final outcome of these matters differs from the
amounts recorded initially, differences may impact the income tax
expense in the period in which such determination is made. Refer to
Note 12, Income tax expense and Note 26, Deferred Taxes.
The utilization of deferred tax assets is dependent on future taxable
profit in excess of the profits arising from reversal of existing taxable
temporary differences. The recognition of deferred tax assets is
based upon whether it is more likely than not that sufficient taxable
profits will be available in the future from which the reversal of
temporary differences and tax losses can be deducted. Recognition
therefore involves judgment with regard to future financial
performance of a particular legal entity or tax group in which the
deferred tax asset has been recognized.
Pensions
The determination of pension obligations and expenses for defined
benefit pension plans is dependent on certain assumptions used by
actuaries in calculating such amounts. Those assumptions include,
among others, the discount rate, expected long-term rate of return
on plan assets and annual rate of increase in future compensation
levels. A portion of plan assets is invested in equity securities which
are subject to equity market volatility. Changes in assumptions and
actuarial conditions may materially affect the pension obligation and
future expense. Refer to Note 6, Pensions.
New accounting pronouncements under IFRS
The Group will adopt the following new and revised standards, and
amendments and interpretations to existing standards issued by the
IASB that are expected to be relevant to its operations:
IFRS 9, Financial Instruments, will change the classification,
measurement and impairment of financial instruments based on
the Groups objectives for the related contractual cash flows.
IFRS 10, Consolidated Financial Statements, establishes principles
for the presentation and preparation of consolidated financial
statements when an entity controls one or more other entities.
IFRS 11, Joint Arrangements, establishes that the legal form of an
arrangement should not be the most significant factor in the
determination of the appropriate accounting for the arrangement.
Each party in a joint arrangement determines the type of joint
arrangement in which it is involved by assessing its rights and
obligations and then accounts for those rights and obligations in
accordance with that type of joint arrangement.
IFRS 12, Disclosure of Interests in Other Entities, requires the
disclosure of information that enables users of financial statements
to evaluate the nature of, and risks associated with, its interests in
other entities and the effects of those interests on its financial
position, financial performance and cash flows.
definition of fair value in a single new IFRS standard. The new

standard provides a framework for measuring fair value, related
disclosure requirements about fair value measurements and
further authoritative guidance on the application of fair value
measurement in inactive markets.
Amended IAS 19, Employee Benefits, discontinues the use of
thecorridor approach and remeasurement impacts will be
recognized in other comprehensive income. Net interest expense
as a product of discount rate and net pension liability will be
recognized in the income statements while the effect from the
difference between the discount rate and actual return on plan
assets will be reflected in remeasurements within other
comprehensive income. Previously unrecognized actuarial gains
and losses are also recognized in other comprehensive income.
Other long-term benefits are required to be measured in the same
way even though changes in the recognized amount are
recognized in profit or loss. Treatment for termination benefits,
specifically the point in time when an entity would recognize a
liability for termination benefits, is also revised.
The effective date for IFRS 10, IFRS 11 and IFRS 12 is January 1,
2013, as issued by the IASB. In December 2012, the EU endorsed
adoption of these standards for companies in the EU, with a
mandatory effective date of January 1, 2014, earlier adoption is
permitted. The Group will early adopt these standards on January 1,
2013 and will also adopt IFRS 13 and the amended IAS 19 on their
effective date, January 1, 2013.
On December 16, 2011 the IASB amended the effective date of
IFRS9 to annual periods beginning on or after January 1, 2015,
andmodified the relief from restating comparative periods and the
associated disclosures in IFRS 7, Financial Instruments: Disclosures.
The Group will adopt the standard on the revised effective date.
The Group does not currently expect the adoption of the amended
IAS 19 to have a material impact on the financial condition and the
results of operations of the Group on a going forward basis.
However, the standard requires retrospective application for all
financial statements presented including previous years. While the
Group does not anticipate a material impact to prior period income
statements as a result of the retrospective application, the Group
expects a material change in the net pension liabilities and other
comprehensive income due to the elimination of the corridor
approach. For 2012, there will be approximately EUR 174 million
(EUR 14 million for 2011) increase in our pension liabilities,
approximately EUR 156 million (EUR 12 million for 2011) decrease,
net of tax, in our other comprehensive income, and approximately
EUR 10 million and (EUR 3 million for 2011) increase in our net
deferred tax asset.
Excluding the impacts of the amended IAS 19, the Group does not
expect that the adoption of the other standards effective January 1,
2013 will have a material impact.
IFRS 13, Fair Value Measurement, replaces fair value measurement

guidance contained within individual IFRSs with a single, unified
Annual Report 2012
75
2 Specific items
The Group separately identifies and discloses certain items, referred to as specific items, by virtue of size, nature or occurrence, including
restructuring charges, country/contract exit charges, purchase price accounting (PPA) related charges and asset impairment charges. This
is consistent with the way that financial performance is measured by management and reported to the senior management team and Board
of Directors and it assists in providing a meaningful analysis of operating results by excluding items that may not be indicative of the operating
results of the Groups business.
In November 2011, the Group announced a strategic shift to focus on the mobile network infrastructure market. This involved a decision to
focus the Groups portfolio on its core profitable businesses and sell or ramp down non-core businesses. The Group also narrowed its regional
focus to make the high value and technologically advanced Japan, South Korea and USA its priority countries and to review certain
underperforming countries or contracts with a view to exiting if necessary. At the same time, the Group announced its intention to reduce its
workforce by 17,000employees by the end of 2013. In 2012, the Group made significant progress in executing this plan both in terms of
focusing on the mobile network infrastructure business, divesting several businesses, exiting certain underperforming customer contracts,
withdrawing from certain countries and making significant reductions in headcount. The associated charges are included in the tables below.
The following table presents specific items included in the operating profit/loss for the Groups continuing operations for the years ended
December 31, 2012, 2011 and 2010:
Country/
contract exit
and mergerRestructuring
related
charges
charges
EURm
2012
Cost of sales
Research & development expenses
Selling & marketing expenses
Administrative & general expenses
Other expenses
Total
2011
Cost of sales
Other expenses
Total
2010
Cost of sales
Other expenses
Total
PPA related
charges
Other
one-time
charges
Total
564
170
116
155
50
89
18
38
266
87
6
653
208
382
242
78
1 055
107
308
93
1 563
28
26
17
13
19
12
2
5
23
11
79
308
1
51
107
330
37
19
103
42
399
544
60
27
15
43
27
114
(8)
6
33
193
286
174
212
307
76
27
172
145
479
796
The following table presents specific items included in the operating profit/loss for the Groups discontinued operations, Optical Networks, for
the years ended December 31, 2012, 2011 and 2010:
2012
2011
2010
Total
PPA related
charges
PPA related
charges
23
1
6
23
23
30
Restructuring
charges
Other
one-time
charges
Cost of sales
Other expenses
1
6
Total
EURm
76
Restructuring charges in 2012 consist primarily of personnel restructuring charges (EUR 911 million). The other main components are real
estate exit costs and a loss, net of gains, of EUR 50 million arising from the sale of divested businesses (refer to Note 8, Acquisitions and
disposals).
Restructuring charges in 2011 consisted primarily of personnel restructuring charges (EUR 68 million) and impairment charges as a result of
writing down the carrying amount of certain disposal groups classified as held for sale to the fair value less costs to sell (refer to Note 31,
Non-current assets and disposal groups classified as held for sale). Restructuring charges in 2010 related to personnel restructuring (EUR
114 million) and structural restructuring for outsourcing and closing manufacturing sites and other real estate locations.
In 2012, country/contract exit charges relate to the realignment of the Groups customer contract and geographic market portfolio and the
related charges to terminate certain underperforming contracts and to withdraw from certain countries in line with the Groups restructuring
program.
Merger-related charges in 2011 and 2010 related to the realignment of the product portfolio and the related charges to replace discontinued
products at customer sites in connection with the Groups formation.
Purchase price accounting (PPA) related charges primarily consist of the amortization of finite lived intangible assets (customer relationships,
developed technology and licenses to use tradename and trademark) recognized in the purchase price allocation stemming from the
Groups formation and subsequent business combinations.
In 2012, other one time charges consist of consultancy fees in connection with the restructuring program included in administrative and
general expenses and impairment charges of EUR 6 million for continuing operations and EUR 23 million for discontinued operations
included in other expenses (refer to Note 9, Impairment and Note 31, Non-current assets and disposal groups classified as held for sale) in
theconsolidated income statement.
3 Segment information
The Groups chief operating decision-maker (CODM) is a group of executive officers comprising the Chief Executive Officer, the Chief
Financial Officer and the Chief Operating Officer. Operating segments have been determined based on the information reviewed by the chief
operating decision-maker for the purposes of allocating resources and assessing performance.
The chief operating decision-maker considers the business from both a geographic and product perspective. The set of components that
constitutes the Groups operating segments has been determined by reference to the core principle governing segment reporting, that is,
based on the provision of information that enables evaluation of the nature and financial effects of the business activities in which the Group
engages and the economic environments in which it operates. Disclosure of information by product dimension is considered to best fulfill this
requirement.
The Group consists of four product-based operating segments: Mobile Broadband, Global Services, Optical Networks and Non-core. At
December 31, 2012 Optical Networks is classified as a disposal group held for sale and as it has represented a separate major line of
business in the past, it is presented as discontinued operations (refer to Note 31, Non-current assets and disposal groups classified as held
for sale). As such, it has been excluded from segment reporting. The Non-core segment does not qualify as a reportable segment in 2012 as
it represents less than 10% of the Groups revenue and operating results.
Mobile Broadband provides radio and core network hardware and software to mobile operators as well as related software and essential
services. Global Services provides professional services including network planning and optimization, the complete management of network
operations, the care and maintenance of network hardware and software and also network implementation and turnkey solutions.
Management assesses the performance of the operating segments based on a measure of operating profit that excludes specific items (for
an analysis of specific items, refer to Note 2, Specific items). The costs of central functions and the Groups worldwide sales and marketing
organization have been allocated to the segments based on the utilization of the respective resources. Taxes, financial income and expenses,
other financial results and share of results of associates are not allocated to segments. There are no transactions between the segments.
Segment revenue as reported here is measured largely in a manner consistent with revenue as reported in the consolidated income
statement. Group level adjustments related to customer projects accounted for under the percentage of completion accounting method
have been allocated to the segments.
No single customer represents 10% or more of Group revenues. No measures of assets and liabilities by segment are reviewed by the chief
operating decision-maker.
Annual Report 2012
77
Mobile
Broadband
EURm
Global
Services
All other
segments
Total
segments
Other
2012
Net sales
Operating profit/(loss) before specific items
Operating profit/(loss) before specific items %
Depreciation and amortization (excluding PPA related charges)
PPA related charges
Restructuring charges
6 043
488
8.1%
199
158
283
6 929
332
4.8%
66
130
414
365
(33)
(9.0)%
7
6
93
13 337
787
35
35
272
294
790
14
265
2011
Net sales
PPA related charges
6 335
214
3.4%
220
195
27
6 737
229
3.4%
71
119
24
573
(108)
(18.8)%
14
15
19
13 645
335
305
329
70
70
33
2010
Net sales
PPA related charges
5 789
153
2.6%
263
271
83
5 889
84
1.4%
67
104
32
528
(71)
(13.4)%
13
34
12 206
166
343
409
115
70
57
Total
13 372
822
6.1%
272
308
1 055
13 645
335
2.5%
305
399
103
12 206
166
1.4%
343
479
172
For an analysis of specific items, refer to Note 2, Specific items.

Net sales by geographic area
The table below presents the Groups net sales by geographic area by location of customer:
EURm
2012
2011
2010
North East Europe

West Europe1
South East Europe
Africa
891
1 900
1 039
548
1 107
2 032
1 257
579
1 086
2 115
1 378
514
Europe & Africa
4 378
4 975
5 093
Middle East
Greater China
Japan
India
APAC
687
1 278
2 173
737
1 270
817
1 457
1 533
911
1 176
876
1 448
704
885
1 110
Asia & Middle East
6 145
5 894
5 023
North America
Latin America
1 201
1 648
1 018
1 758
649
1 441
Americas
Total
Of which the Netherlands (country of domicile)
1
78
2 849
2 776
2 090
13 372
13 645
12 206
111
185
113
Non-current assets
The table below presents the Groups largest countries in terms of non-current assets:
EURm
2012
2011
Finland
USA
China
India
Japan
Germany
Poland
Other
452
183
107
74
66
24
24
148
334
311
177
95
71
62
32
431
1 078
1 513
2012
2011
2010
3 431
2 603
4 769
2 942
5 094
2 872
Total
The Netherlands (country of domicile)
Non-current assets comprise intangible assets and property, plant and equipment.
4 Revenue recognition
The following table presents net sales for continuing operations for the years ended December, 31:
EURm
Contract sales recognized under percentage of completion accounting

Services revenue for managed services and network maintenance contracts
Sales of telecommunication equipment, software and related services not involving
the modification of complex telecommunication equipment
Total net sales
7 338
5 934
4 240
13 372
13 645
12 206
The following revenue recognition related items are included in the consolidated statement of financial position:
2012
EURm
Contract revenues recorded prior to billings
Assets
700
Billings in excess of costs incurred
Assets
Liabilities
1 267
216
Advances received related to construction

Retentions related to construction contracts
2011
Liabilities
260
58
100
95
136
All assets in the above table are included within accounts receivable and all liabilities are included within accrued expenses in the statement
offinancial position.
The aggregate amount of costs incurred and recognized profits (net of recognized losses) for construction contracts in progress is
EUR18107 million at December 31, 2012 (EUR 20 077 million in 2011).
Annual Report 2012
79
5 Employee benefits expense

EURm
2012
2011
2010
Salaries and wages

Share-based payment expense/(income)
Pension expenses
Other social expenses
3 744
11
204
494
3 466
(8)
196
482
3 015
(5)
186
414
Total
4 453
4 136
3 610
Pension expenses include expenses related to defined contribution plans of EUR 164 million (EUR 153 million in 2011 and EUR 141 million
in2010).
The average monthly number of employees in 2012 was 64 052 (71 882 in 2011 and 65 379 in 2010).
6Pensions
The Groups largest defined benefit pension plans are in Germany where individual benefits are generally based on eligible compensation
levels and/or ranking within the company and years of service. The majority of active employees in Germany participate in the pension
scheme BAP (Beitragsorientierter Altersversorgungs Plan), formerly known as Beitragsorientierte Siemens Altersversorgung. This plan is a
partly funded defined benefit pension plan, the benefits of which are predominantly based on contributions made by the company and
returns earned on such contributions, subject to a minimum return guaranteed by the company. Prior to this plan, employees participated in
the IP-Plan (Individuelle Pensionszusage), which was closed to new entrants in 2003 and any entitlement previously earned was integrated
into the BAP. The funding vehicle for the BAP and former IP plan is the NSN Pension Trust e.V.
Other significant plans are in Switzerland, India and the United Kingdom (UK). In Switzerland, individual benefits are provided through the
collective foundation Profond. The plans benefits are based on age, years of service, salary and on an individual old age account. The
funding vehicle for the pension scheme is the Profond Vorsorgeeinrichtung. In India, government mandated Gratuity and Provident plans
provide benefits based on years of service and projected salary levels at date of separation for the Gratuity plan and through an interest rate
guarantee on existing investments in a Government prescribed Provident Fund Trust. In the UK, individual benefits are generally dependent
on eligible compensation levels and years of service for the defined benefit section of the plan and on individual investment choices for the
defined contribution section of the plan. The funding vehicle for the pension plan is the Nokia Siemens Networks Pension Plan that is run on a
Trust basis.
In addition, the Group operates a number of post-employment benefit plans in various other countries. These plans include both defined
contribution and defined benefit plans.
80
Defined benefit pension plans

The following table reconciles the opening and closing balances of the defined benefit obligation and the fair value of plan assets at
December 31:
EURm
2012
2011
Present value of defined benefit obligation at beginning of year

Foreign currency exchange rate changes
Current service cost
Interest cost
Plan participants contributions
Past service cost loss
Actuarial loss
Acquisitions and divestments
Curtailments1
Settlements
Benefits paid
Other movements2
(1 221)
2
(49)
(56)
(15)
(2)
(220)
14
13
12
47
(2)
(1 088)
3
(47)
(56)
(8)
(1)
(7)
(1)
3
16
28
(63)
Present value of defined benefit obligation at end of year
(1 477)
(1 221)
Plan assets at fair value at beginning of year

Expected return on plan assets
Actuarial gain/(loss) on plan assets
Employer contribution
Plan participants contributions
Benefits paid
Settlements
Other movements2
1 124
(2)
56
61
31
15
(32)
(12)
(9)
1
1 050
(2)
52
(48)
34
8
(21)
(2)
(10)
63
Plan assets at fair value at end of year
1 233
1 124
In 2012, the Group recognized curtailments related to restructuring in various countries including Germany, Belgium, Switzerland and the Netherlands.
In 2011, the Group reclassified an existing pension plan as a defined benefit plan due to a requirement to cover a shortfall in the return on plan assets. This reclassification did
not have a material impact on the Groups financial statements.
1
2
The following table reconciles the present value of the defined benefit obligation and the fair value of plan assets to the accrued pension cost
recognized in the statement of financial position:
EURm
Present value of defined benefit obligation

Fair value of plan assets
Deficit
Unrecognized past service cost
Unrecognized net actuarial loss
Amount not recognized as an asset in the statement of financial position due to the limit in
IAS 19 paragraph 58(b)
Accrued pension cost in statement of financial position
2012
2011
(1 477)
1 233
(1 221)
1 124
(244)
1
171
(97)
1
16
(2)
(2)
(74)
(82)
The present value of the defined benefit obligation includes EUR 243 million (EUR 126 million in 2011) of wholly funded obligations,
EUR1196million (EUR 1 055 million in 2011) of partly funded obligations and EUR 38 million (EUR 40 million in 2011) of unfunded obligations.
Annual Report 2012
81
The amounts recognized in the income statement are as follows:
EURm
2012
2011
2010
Current service cost

Interest cost
Expected return on plan assets
Net actuarial loss/(gain) recognized
Past service cost loss
Impact of IAS 19 paragraph 58(b)
Curtailments and settlements
49
56
(56)
5
2
(16)
47
56
(52)
7
1
(7)
(9)
47
52
(55)
(3)
1
3
Total included in employee benefits expense
40
43
45
2012
2011
The movements in accrued pension cost recognized in the statement of financial position are as follows:
EURm
Accrued pension cost at beginning of year

Net expense recognized
Contributions paid
Benefits paid
82
40
(31)
(15)
(2)
78
43
(34)
(6)
2
(1)
Accrued pension cost at end of year
74
82
The net accrued pension cost above is made up of an accrual of EUR 106 million included in other long-term liabilities (EUR 108 million in
2011), a prepayment of EUR 41 million included in prepaid expenses and accrued income (EUR 31 million in 2011) and EUR 9 million
reclassification to liabilities included in disposal groups classified as held for sale (EUR 5 million in 2011). Refer to Note 31, Non-current assets
and disposal groups classified as held for sale.
The following table shows the deficit or surplus in the Groups plans and the history of experience adjustments:
EURm
2012
Present value of defined benefit obligation

Fair value of plan assets
(Deficit)/surplus
Experience adjustment (loss)/gain on plan obligations
Experience adjustment gain/(loss) on plan assets
2011
2010
2009
2008
(1 477)
1 233
(1 221)
1 124
(1 088)
1 050
(964)
955
(822)
847
(244)
(97)
(38)
(9)
25
(21)
61
21
(48)
19
(9)
1
41
31
3
The principal actuarial weighted average assumptions used are as follows:
2012
2011
Discount rate for determining present values

Inflation rate
Expected long-term rate of return on plan assets
Annual rate of increase in future compensation levels
Pension increases
3.54
1.82
3.11
2.36
1.64
4.89
1.83
4.50
2.39
1.60
82
The Groups weighted average pension plan asset allocation as a percentage of plan assets by asset category at December 31 is as follows:
Asset category:
Equity securities
Debt securities
Insurance contracts
Real estate
Short-term investments
Other
Total
2012
2011
24
56
5
5
4
6
22
59
5
5
4
5
100
100
The objective of the investment activities is to maximize the excess of plan assets over projected benefit obligations, within an accepted risk
level, taking into account the interest rate and inflation sensitivity of the assets as well as the obligations. Additionally, the objective is to
generate an efficient strategic asset allocation in accordance with the Groups investment policy to achieve the required return on pension
assets.
The total expected return on plan assets is based on the expected return multiplied by the respective percentage weight of the market-related
value of plan assets. The expected return is defined on a uniform basis, reflecting long-term historical returns, current market conditions and
strategic asset allocation.
In 2012, the actual return on plan assets was EUR 117 million (EUR 4 million in 2011).
In 2013, the Group expects to make contributions of EUR 25 million to its defined benefit pension plans.
7 Other income and expenses

Other income totals EUR 105 million in 2012 (EUR 92 million in 2011 and EUR 97 million in 2010). None of the items within this total are
individually significant.
Other expenses total EUR 223 million in 2012 (EUR 79 million in 2011 and EUR 142 million in 2010). This includes a loss, net of gains, of EUR
50 million arising from the sale of divested businesses (refer to Note 8, Acquisitions and disposals), EUR 40 million costs resulting from the
sale of receivables transactions, EUR 38 million of expense that is the net result of bad debt write-offs and changes to the doubtful account
allowances (refer to Note 20, Allowances for doubtful accounts) and EUR 23 million impairment charges in connection with the Optical
Networks business (refer to Note 9, Impairment and Note 31, Non-current assets and disposal groups classified as held for sale).
Other income in 2011 included a gain of EUR 9 million on the sale of real estate in Beijing, China. Other expenses included EUR 35 million of
income that is the net result of bad debt write-offs and changes to the doubtful account allowances (refer to Note 20, Allowances for doubtful
accounts) and costs of EUR 33 million resulting from sale of receivables transactions. Other expenses also included impairment charges of
EUR 19 million as a result of writing down the carrying amount of certain disposal groups classified as held for sale to the fair value less costs
to sell (refer to Note 9, Impairment).
Other income in 2010 included EUR 21 million which mainly relates to interest or amounts paid in excess to the Brazil Instituto Nacional do
Seguro Social (INSS or National Institute for Social Security). The Group had the right to recover the interest receivable and overpayments
made from the INSS. Other expenses included EUR 28 million in charges related to the transfer of the Groups Italian Radio Access activities
to Value Team SpA, an IT consulting and solutions company of the Value Partners Group.
In all three years presented, other income and expenses also include the fair value changes of derivatives hedging identifiable and probable
forecasted cash flows and the costs and income of hedging forecasted sales and purchases (forward points of cash flow hedges).
Annual Report 2012
83
8 Acquisitions and disposals

Acquisitions completed in 2012
There were no acquisitions effected in 2012. On April 30, 2012 the Group completed the accounting for the Motorola Solutions networks
business combination, which was effected on April 30, 2011. The acquired business consisted of Motorola Solutions wireless networks
infrastructure equipment manufacturing and sales operations, including the GSM, CDMA, WCDMA, WiMAX and LTE product portfolios and
services offerings, and was carried out through a combination of asset and share deals. The business acquisition strengthened the Groups
position in certain regions, particularly North America and Japan. The goodwill of EUR 164 million arising from the acquisition is attributable to
the increased presence in these key markets and the assembled workforce. The majority of the goodwill acquired is deductible for income
tax purposes.
The following table summarizes additional adjustments identified during the measurement period and the final fair values of assets acquired,
liabilities assumed and the non-controlling interest at the acquisition date:
EURm
Total cash consideration
Provisional
fair values
Adjustments
Final
fair values
642
642
Non-current assets
Goodwill
Intangible assets subject to amortization:
Developed technology
Customer relationships
155
164
156
195
3
156
195
3

Investments in associates
Deferred tax assets
509
105
6
36
9
(8)
518
97
6
36
656
657
103
228
20
31
(6)
103
222
20
31
382
1 038
(6)
(5)
376
1 033
15
15
15
15
Current assets
Inventories
Accounts receivable
Bank and cash
Total assets acquired
30
30
Current liabilities
Accounts payable
Accrued expenses
Provisions
154
166
30
(1)
(2)
(2)
153
164
28
Total liabilities assumed

Non-controlling interest
350
380
16
(5)
(5)
345
375
16
Net assets acquired
642
642
The fair values of developed technology and customer relationships acquired in the deal have been estimated through relief from royalty and
excess earnings methods of valuation, respectively. Key assumptions applied in the valuation models included royalty rates ranging from 3%
to 10% for the developed technology, and a discount rate of 14.1% for customer relationships.
84
The acquisition of the Motorola Solutions networks business included a contingent consideration arrangement that required Motorola
Solutions to make installment payments to the Group subject to certain conditions being fulfilled by the Group. The maximum amount of
installment payments under the arrangement, EUR 85 million, was received, of which EUR 68 million was received in 2012 and EUR 17 million
in 2011. On receipt of the final payment in 2012, EUR 4 million was recognized in the consolidated income statement as the consideration
received was in excess of the fair value of the EUR 81 million receivable recognized.
The fair value of accounts receivable of EUR 222 million includes trade receivables with a fair value of EUR 146 million. The gross contractual
amount for trade receivables due at the date of acquisition was EUR 255 million, of which EUR 109 million was expected to be uncollectible.
Acquisition-related costs of EUR 4 million and EUR 8 million for 2011 and 2010, respectively, are included in the consolidated income
statement in administrative and general expenses.
From the date of acquisition on April 30, 2011 the Group included net sales of EUR 894 million and a net loss of EUR 4 million for the year
ended December 31, 2011 in respect of the acquired Motorola Solutions networks business. The net loss included EUR 39 million related to
restructuring charges and EUR 48 million related to the amortization of acquired intangible assets and other purchase price accounting
related charges.
The Groups net sales and net loss for the year ended December 31, 2011 would have been EUR 14 828 million and EUR 612 million,
respectively, had the acquisition occurred on January 1, 2011. This unaudited pro forma information is not necessarily indicative of the results
of the combined operations had the acquisition actually occurred on January 1, 2011 or indicative of the future results of the combined
operations.
The non-controlling interest (representing 49% of Motorola Solutions Hangzhou subsidiary) in the Motorola Solutions networks business
recognized at the acquisition date was measured at the present ownership interests proportionate share in the recognized amounts of the
acquirees net identifiable assets and amounted to EUR 16 million.
Other acquisitions effected in 2011
On January 3, 2011 the Group acquired 100% of the share capital of Iris Telekomnikasyon Mhendislik Hizmetleri A.S, a telecom and
engineering services provider with its headquarters in Istanbul, Turkey. The purchase consideration paid and goodwill arising from the
acquisition amounted to EUR 20 million and EUR 6 million, respectively.
Acquisitions effected in 2010
There were no acquisitions in 2010.
Disposals effected in 2012
In 2012, the Group divested several non-core businesses as part of the implementation of its strategy to focus on mobile broadband and
services. On January 11, 2012 the Group entered into an agreement with Motorola Solutions Inc. to transfer all assets and liabilities related to
the Norwegian nationwide TETRA Ndnett project, including associated employees. The transaction was completed on February 24, 2012.
The sale of the WiMax business to NewNet Communication Technologies, LLC was completed on February 3, 2012. On May 3, 2012 the
Group concluded the sale of its fixed line broadband access business to Adtran Inc., and on June 1, 2012 the initial closing of the transaction
to sell the microwave transport business to DragonWave Inc. was completed. Additionally, the Group carried out three other disposals that
did not have a material impact on the consolidated financial statements. The total net consideration paid in connection with these disposals
amounted to EUR 124 million in cash. Additionally, shares with fair market value of EUR 5 million were received.
Annual Report 2012
85
The results of businesses disposed of are included in the consolidated income statement up to the date of disposal. The assets and liabilities
disposed of were as follows:
EURm
2012

Inventories
Accounts receivable
1
24
28
1
Total assets disposed of
54
Accounts payable
Accrued expenses
Provisions
19
13
117
Total liabilities disposed of
149
Additionally, provisions of EUR 26 million were recognized for contractual obligations entered into at closing.
A loss, net of gains, of EUR 50 million arising from the sale of these businesses is included in other expenses in the consolidated income
statement.
There were no disposals in 2011.
On May 12, 2010 the Group completed the transfer of its Radio Access activities in Italy to Value Team SpA, an IT consulting and solutions
company of the Value Partners Group. The two companies also signed a long-term collaboration agreement which defines Value Team as
one of the Groups preferred partners in the development of new technologies, mainly in mobile networks. In 2010, the Group also completed
the divestment of its cable television business in Luxembourg, and the sale of 100% ownership in Garderos Software Innovations GmbH in
Germany. Total consideration received for the disposals in 2010 amounted to EUR 11 million in cash. In 2011, an additional EUR 1 million of
cash was received in relation to divestments effected in 2010.
The assets and liabilities disposed of were as follows:
EURm
2010

Inventories
Accounts receivable
Bank and cash
7
1
24
12
Total assets disposed of
44
Accounts payable
Accrued expenses
1
8
Total liabilities disposed of
86
9Impairment
Goodwill
2012
For the purpose of impairment testing, goodwill is allocated to the Groups cash-generating units or groups of cash-generating units (CGUs)
that are expected to benefit from the synergies of the business combination in which the goodwill arose.
The recoverable amounts of the groups of cash-generating units were determined based on the fair value less costs to sell approach. In the
absence of observable market prices, the fair values less costs to sell were estimated based on an income approach, specifically a
discounted cash flow model.
The cash flow projections employed in the model were based on financial plans approved by management covering an explicit forecast
period of three years. Cash flows in the subsequent periods reflect a realistic pattern of slowing growth that declines towards an estimated
terminal growth rate utilized in the terminal period. The terminal growth rates utilized do not exceed the long-term average growth rates for the
industry and economies in which the cash-generating units operate. The projections utilized are consistent with external sources of
information wherever available.
The key assumptions applied in the impairment testing analysis and goodwill allocated to each group of cash-generating units at December
31, 2012 are presented in the table below:
EURm
Radio Access Networks group of CGUs

Global Services group of CGUs
Total
Discount rate
Carrying amount
of goodwill
Terminal
growth rate
Post-tax
Pre-tax
90
92
1.37%
0.00%
10.88%
9.68%
14.74%
13.33%
182
Other key variables within the future cash flow projections utilized include assumptions around estimated sales growth and gross margin.
Due to exchange rate fluctuations, the goodwill allocated to the Global Services group of cash-generating units which is largely denominated
in US dollars, is EUR 1 million less at December 31, 2012 compared to the euro value at September 30, 2012, the date of goodwill impairment
testing.
The goodwill impairment testing analysis did not result in impairment charges. A sensitivity analysis has been carried out with respect to the
gross margin and discount rate assumptions applied. The recoverable amounts calculated based on the sensitized assumptions do not
indicate impairment. Further, no reasonably possible changes in other key assumptions on which the Group has based its determination of
the recoverable amounts would result in impairment charges.
2011
Goodwill impairment testing was performed at December 31, 2011 following the Groups announcement of a new strategy and related
restructuring in November 2011. For the purpose of the impairment testing, goodwill which was provisional with respect to the business
acquired from Motorola Solutions was allocated on a provisional basis to the Groups cash-generating units as follows:
EURm
Carrying amount
of goodwill
Network Systems
Global Services
Business Solutions
83
90
Total
173
The recoverable amounts of the cash-generating units were determined based on the fair value less costs to sell approach. In the absence of
observable market prices, the fair value less costs to sell was estimated based on an income approach, specifically a discounted cash flow
model.
Annual Report 2012
87
The cash flow projections employed in the model were based on financial plans approved by management. These projections are consistent
with external sources of information, wherever available. Cash flows beyond the explicit forecast period of four years were extrapolated by
applying an estimated residual growth rate of 1% for the cash-generating units. This residual growth rate does not exceed the long-term
average growth rates for the industry and economies in which the cash-generating units operate. The post-tax cash flow projections of the
cash-generating units were discounted using a post-tax discount rate of 10.36%, which corresponds to a pre-tax discount rate of 13.77%.
Other key variables within the future cash flow projections include assumptions around estimated sales growth and gross margin.
The goodwill impairment testing analysis did not result in impairment charges. A sensitivity analysis was carried out by applying lower
estimated gross margin assumptions and certain execution risk adjustments to expected savings in operating expenses. The recoverable
amounts calculated based on these sensitized assumptions did not indicate impairment. Further, no reasonably possible changes in other
key assumptions on which the Group had based its determination of the cash-generating units recoverable amounts would have resulted in
impairment charges.
The Group recognized a charge of EUR 8 million on intangible assets in connection with its decision to cease product development for certain
operations. This impairment charge is included in other expenses in the consolidated income statement.
In 2011, in connection with the Groups announcement of a new strategy and related restructuring in November 2011 and as part of the
goodwill impairment testing, the Group conducted an assessment of the carrying amounts of the identifiable intangible and tangible assets
that were allocated to the above cash-generating units and concluded that the carrying amounts were recoverable.
Investments in associates and other companies
In 2012, the Group recognized an impairment charge of EUR 6 million to adjust investment in one of its associates to the recoverable amount.
This impairment charge is recognized in other expenses in the consolidated income statement.
Non-current assets and disposal groups held for sale
In 2012, the Group recognized impairment charges of EUR 23 million on the property, plant and equipment of the Optical Networks business
as a result of writing down the carrying amount to the fair value less costs to sell (refer to Note 31, Non-current assets and disposal groups
classified as held for sale). This impairment charge is included within other expenses in the consolidated income statement.
In 2011, the Group recognized impairment charges totaling EUR 19million as a result of writing down the carrying amount of certain disposal
groups classified as held for sale to the fair value less costs to sell. The impairment charge is included in other expenses in the consolidated
income statement.
10 Depreciation and amortization

Depreciation and amortization by function:
EURm
2012
2011
2010
Depreciation and amortization by function

Cost of sales
Research and development
Selling and marketing
Administrative and general
74
180
271
62
74
261
312
64
70
424
291
58
Total
587
711
843
The above table includes depreciation and amortization related to discontinued operations, totaling EUR 11 million in 2012 (EUR 19 million in
2011 and EUR 20 million in 2010).
88
11 Financial income and expenses

EURm
Interest income on available-for-sale financial instruments

Interest income on loans receivables carried at amortized cost
Other financial income
Financial income
2012
2011
2010
13
1
1
12
1
2
11
15
15
14
Interest expense on financial liabilities carried at amortized cost

Other financial expenses
(113)
(10)
(95)
(13)
(137)
(20)
Financial expense
(123)
(108)
(157)
Net foreign exchange (losses)/gains:

From foreign exchange derivatives designated at fair value through profit andloss
From statement of financial position items revaluation
Net losses on other derivatives designated at fair value through profit and loss
(28)
(171)
58
(114)
(2)
(356)
255
(4)
Other financial results
(199)
(58)
(105)
Total
(307)
(151)
(248)
EURm
2012
2011
2010
Income tax expense/(benefit)

Current tax
Deferred tax
239
103
270
(36)
255
(91)
Total
342
234
164
(9)
351
(13)
247
47
117
342
234
164
12 Income tax expense
Netherlands
Other countries
Total
The difference between the income tax expense computed at the statutory rate in the Netherlands of 25% (25% in 2011 and 25.5% in 2010)
and income taxes recognized in the consolidated income statement is reconciled as follows at December 31:
EURm
2012
2011
2010
Income tax benefit at statutory rate

Permanent differences
Taxes for prior years
Effect of different statutory tax rates in foreign subsidiaries
Net change in tax contingencies
Changes in income tax rates
Increase in valuation adjustments of deferred tax assets1
Benefit arising from previously unrecognized tax losses and
temporary differences
Change of deferred tax liability on undistributed earnings
Other
(260)
31
(18)
(28)
(24)
5
640
(94)
30
1
12
5
6
265
(221)
102
73
(11)
2
2
278
1
(5)
(9)
9
9
(63)
4
(2)
Income tax expense
342
234
164
In 2012, this item primarily relates to current year Finnish tax losses and temporary differences and past and current year German tax losses and temporary differences for which
no deferred tax was recognized. In 2011 and 2010, this item primarily related to Finnish tax losses and temporary differences for which no deferred tax was recognized.
Income tax returns of certain Group companies for the years prior to and after the formation of the Group are under examination by the
relevant tax authorities. The Group does not believe that any significant additional taxes in excess of those already provided for will arise as a
result of these examinations.

Annual Report 2012
89
13 Intangible assets
EURm
2012
2011
Goodwill
Acquisition cost January 1
Acquisitions
173
(1)
10
12
161
Accumulated acquisition cost December 31
182
173
Net book value January 1

Net book value December 31
173
182
173

Additions
Acquisitions
Impairment losses
Disposals and retirements
3 021
(2)
25
(51)
(17)
2 625
24
16
365
(9)
2 976
3 021
Accumulated amortization January 1

Impairment losses
Amortization
(2 328)
(1)
43
16
(319)
(1 928)
(1)
7
(406)
Accumulated amortization December 31
(2 589)
(2 328)

693
387
697
693
Capitalized development costs

823
(7)
823
816
823
Accumulated amortization January 1

Amortization
(817)
7
(6)
(785)
(32)
Accumulated amortization December 31
(816)
(817)
38
6

Goodwill adjustment due to a fair value adjustment relating to the acquisition of Motorola Solutions networks business (refer to Note 8, Acquisitions and disposals).
Capitalized development costs are included in Other intangible assets in the consolidated statement of financial position.
1
2
At December 31, 2012 other intangible assets include customer relationships with a carrying value of EUR 217 million (EUR 466 million in
2011), developed technology with a carrying value of EUR 131 million (EUR 177 million in 2011), and licenses to use tradename and trademark
of EUR 1 million (EUR 20 million in 2011). The remaining amortization period ranges from one month to three years for licenses to use
tradename and trademark, from one month to five years for developed technology and from three months to five years for customer
relationships.
90
14 Property, plant and equipment

EURm
2012
2011
9
1
10

9
10
1
9

Additions
Acquisitions
Impairment losses
266
(2)
32
(1)
(32)
214
29
32
(9)
263
266
(96)
1
25
(43)
(56)
(1)
6
(45)
Land and water areas

Acquisitions
Accumulated depreciation January 1

Depreciation
Accumulated depreciation December 31
(113)
(96)

170
150
158
170
1 673
173
(8)
(86)
(177)
(44)
1 479
(4)
247
65
(10)
(88)
(16)

Additions
Acquisitions
Impairment losses
Assets classified as held for sale
1 531
1 673
Accumulated depreciation January 1

Impairment losses
Assets classified as held for sale
Depreciation
(1 247)
63
169
35
(219)
(1 103)
(14)
82
14
(226)
Accumulated depreciation December 31
(1 199)
(1 247)
426
332
376
426
36
(3)
13
(2)
24
(1)
31
1
(5)
(12)
(10)
2
(8)
(13)

Fixed assets under construction
Net carrying amount January 1
Additions
Acquisitions
Transfers to:
Net carrying amount December 31
Total property, plant and equipment
17
36
509
641
Fair value adjustment relating to the acquisition of Motorola Solutions networks business (refer to Note 8, Acquisitions and disposals).
Annual Report 2012
91
15 Investments in associates
EURm
2012
2011
Net carrying amount of associates January 1

Additions
Share of results
Dividends
Impairment
Disposals
28
(6)
(3)
4
42
(1)
6
(17)
(2)
Net carrying amount of associates December 31
31
28
The Groups investments in associates are in unlisted companies in all years presented. The reporting date of the financial statements used
for calculation is within three months of the Groups period end, in accordance with the availability of financial information of the Groups
associates.
In 2012, the Group recognized an impairment charge of EUR 6 million to adjust investment in one of its associates to the recoverable amount.
There are no unrecognized losses in respect of associates (EUR 2 million in 2011).
The following table presents the Groups principal associates. All amounts are in millions.
Assets
Principal associates
2010
TD Tech Holding Ltd.1
Fujian Funo Mobile Communication
Technology Ltd.2
2011
Technology Ltd.2
2012
Technology Ltd.2
Local currency is HKD.
Local currency is CNY.
1
2
92
Local
currency
Liabilities
EUR
Local
currency
1 785
174
351
Net sales
Profit/(loss) for the year
EUR
Local
currency
EUR
Local
currency
EUR
1 298
127
4 689
452
220
21
40
97
11
230
25
24
741
73
769
76
1 570
144
(527)
(48)
426
51
145
18
292
32
28
542
53
419
41
2 264
227
152
15
440
54
141
17
234
29
18
16 Fair value of financial instruments

The following table presents the carrying amounts and the fair values of financial instruments by measurement category at December 31:
Carrying amounts
EURm
Current Non-current
availableavailablefor-sale
for-sale
financial
financial
assets
assets
2012
Available-for-sale investments1
Long-term loans receivable2
Accounts receivable
Current portion of long-term loans receivable3
Derivatives and other current financial assets
Fixed income and money-market investments carried
atfair value
708
Total financial assets
708
Loans and
receivables
measured
at
amortized
cost
156
63
4 111
37
9
156
4 220
Financial
liabilities
measured
at
amortized
cost
29
29

Current portion of long-term loans payable
Other long-term non-interest bearing financial liabilities
Derivative and Other Financial liabilities
Accounts payable
Total financial liabilities
Financial
assets and
liabilities at
fair value
through
profit or
loss
16
16
Total
carrying
amounts
Fair value
29
63
4 111
37
165
29
60
4 111
37
165
708
708
5 113
5 110
821
195
821
195
824
195
124
10
2 352
124
26
2 352
124
26
2 352
3 502
3 518
3 521
Annual Report 2012
93
Carrying amounts
Current Non-current
availableavailablefor-sale
for-sale
financial
financial
assets
assets
EURm
2011
Available-for-sale investments1
Long-term loans receivable2
Accounts receivable
Current portion of long-term loans receivable3
Derivatives and other current financial assets
atfair value
897
897
Loans and
receivables
measured
at
amortized
cost
42
85
5 215
54
19
42
5 373
Financial
liabilities
measured
at
amortized
cost
23
23

Current portion of long-term loans payable
Other long-term non-interest bearing financial liabilities
Derivative and Other Financial liabilities
Accounts payable
Financial
assets and
liabilities at
fair value
through
profit or
loss
76
76
Total
carrying
amounts
Fair value
23
85
5 215
54
61
23
82
5 215
54
61
897
897
6 335
6 332
366
357
3
888
21
2 209
366
357
3
888
97
2 209
372
357
3
888
97
2 209
3 844
3 920
3 926
Includes investments in publicly quoted equity shares and investments carried at fair value of EUR 5 million and EUR 24 million, respectively in 2012 (EUR 1 million and
EUR22 million in 2011).
2
Includes EUR 39 million (EUR 60 million in 2011) relating to customer financing.
3
Includes EUR 35 million (EUR 54 million in 2011) relating to customer financing.
1
The long-term loans receivable fair value is measured by amortizing the future cash flows of customer loans using the current credit risk factor
(discount factor) of the borrower, whereas the carrying amount is based on the effective interest rate. The fair values of accounts receivable
and accounts payable are assumed to approximate their carrying amounts due to their short-term nature. The fair values are estimated to be
equal to the carrying amounts for short-term financial assets and financial liabilities due to the limited credit risk and short maturity. Fixed
income and money-market investments include available-for-sale investments, liquid assets of EUR 2 million (EUR 13 million in 2011) and
available-for-sale investments, cash equivalents of EUR 706 million (EUR 884 million in 2011).
The fair value of long-term interest bearing liabilities is determined with reference to quoted yield curves. Derivative and other current financial
assets include EUR 156 million derivative assets (EUR 42 million in 2011). Derivative and other financial liabilities include EUR 16 million
derivative liabilities (EUR 76 million in 2011) and a non-derivative short-term financial liability of EUR 8 million related to assets held temporarily
by the Group due to a sale of receivable arrangement in China (EUR 21 million in 2011). The fair value of other financial liabilities is assumed to
approximate the carrying amount due to its short-term nature.
For information on the valuation of items measured at fair value refer to Note 1, Accounting principles. Refer to Note 17, Derivative financial
instruments for the split of hedge accounted and non-hedge accounted derivatives.
94
Fair value hierarchy

The following table presents the valuation methods used to determine the fair values of financial instruments carried at fair value at December 31:
EURm
2012
at fair value
Investments at fair value through profit and loss
Available-for-sale investments in publicly quoted
equity shares
Other available-for-sale investments carried at fair value
Derivative assets
Instruments with
quoted prices in
active markets
(Level 1)
Valuation
technique using
observable data
(Level 2)
Valuation
technique using
non-observable data
(Level 3)
Total
708
708
14
156
10
5
24
156
713
170
10
893
Derivative liabilities
26
26
26
26
Instruments with
quoted prices in
active markets
(Level 1)
Valuation
technique using
observable data
(Level 2)
Valuation
technique using
non-observable data
(Level 3)
Total
897
897
13
42
1
22
42
EURm
2011
at fair value
Investments at fair value through profit and loss
Available-for-sale investments in publicly quoted
equity shares
Other available-for-sale investments carried at fair value
Derivative assets
898
55
962
Derivative liabilities
76
76
76
76
Level 1 includes financial assets and liabilities that are measured in whole or significant part by reference to published quotes in an active
market. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange,
dealer, broker, industry group, pricing service or regulatory agency and those prices represent actual and regularly occurring market
transactions on an arms length basis. This level includes listed bonds and other securities, listed shares and exchange traded derivatives.
Level 2 includes financial assets and liabilities measured using a valuation technique based on assumptions that are supported by prices
from observable current market transactions. These include assets and liabilities for which pricing is obtained via pricing services but where
prices have not been determined in an active market, financial assets with fair values based on broker quotes, investments in private equity
funds with fair values obtained via fund managers and assets that are valued using the Groups own valuation models in which the material
assumptions are market observable. The majority of the Groups over-the-counter derivatives and certain other instruments not traded in
active markets fall within this level.
Level 3 valuation techniques using non-observable inputs mean that fair values are determined in whole or in part using a valuation technique
based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they
based on available market data. However, the fair value measurement objective remains the same, that is, to estimate an exit price from the
Groups perspective. The main asset classes in this level are unlisted equity investments and unlisted funds.
Annual Report 2012
95
The following table reconciles the opening and closing balances of financial instruments in Level 3:
Other
available-for-sale
investments carried
at fair value
EURm
Purchases
Other movements
9
(7)
Purchases
10
17 Derivative financial instruments

Assets
Fair value1
EURm
Liabilities
Notional2
Fair value1
Notional2
2012
Cash flow hedges:
Forward foreign exchange contracts
Derivatives not designated in hedge accounting
relationships carried at fair value through
profitand loss:
Currency options bought
Currency options sold
Interest rate swaps
40
(2)
1 111
143
12
4 400
503
150
(12)
(2)
1 545
54
150
Total
156
5 093
(16)
2 860
Assets
Fair value1
EURm
Liabilities
Notional2
Fair value1
Notional2
2011
Cash flow hedges:
Derivatives not designated in hedge accounting
relationships carried at fair value through
profitand loss:
Currency options bought
Currency options sold
Interest rate swaps
Other derivatives
1 680
(15)
1 838
33
2
2 617
312
(57)
(3)
(1)
2 752
136
150
Total
42
4 609
(76)
4 876
The fair value of derivative financial instruments is included as an asset in other financial assets and as a liability in other financial liabilities.
Includes the gross amount of all notional values for contracts that have not yet been settled or cancelled. The amount of notional value outstanding is not necessarily a
measure or indication of market risk as the exposure of certain contracts may be offset by that of other contracts.
1
2
At December 31, 2012, the Forward foreign exchange contracts under Cash flow hedges exclude the impact of the classification change of the Forward
foreign exchange contracts from qualifying cash flow hedges to non-qualifying cash flow hedges, and are included under Forward foreign exchange
contracts in Derivatives not designated in hedge accounting relationships carried at fair value through profit and loss. Previously these were included
under Forward foreign exchange contracts under Cash flow hedges. For comparability purposes, this reclassification was also made for 2011. There is
no change in total derivative financial instruments assets or liabilities as a result of the reclassification.
96
18Inventories
EURm
2012
2011
Raw materials and supplies

Work in progress
Finished goods
Advances to suppliers
200
217
564
3
315
235
719
6
Total
984
1 275
In 2012, the cost of inventories recognized as an expense and included in cost of sales was EUR 3 868 million (EUR 4 266 million in 2011 and
EUR 4 007 million in 2010).
Movements in allowances for excess and obsolete inventory:
EURm
2012
2011
2010
At January 1
Charged to income statement
Deductions
223
142
(127)
225
105
(107)
272
75
(122)
At December 31
238
223
225
Deductions include utilization and releases of the allowances. In 2012, deductions also include a reclassification to assets of disposal groups
classified as held for sale of EUR 39 million (EUR 2 million in 2011). Refer to Note 31, Non-current assets and disposal groups classified as held
for sale.
19 Prepaid expenses and accrued income

EURm
2012
2011
VAT
Other taxes
Deposits
Prepaid pension costs
Other prepaid expenses and accrued income
167
409
45
41
217
194
430
50
31
346
Total
879
1 051
Other prepaid expenses and accrued income include various amounts which are individually insignificant.
20 Allowances for doubtful accounts

Movements in allowances for doubtful accounts:
EURm
2012
2011
2010
At January 1
Charged to income statement
Deductions
110
46
(36)
159
43
(92)
154
70
(65)
At December 31
120
110
159
Deductions include utilization and releases of the allowances. In 2011, deductions also included reclassifications to assets of disposal groups
classified as held for sale of EUR 2 million. Refer to Note 31, Non-current assets and disposal groups classified as held for sale.
Annual Report 2012
97
21 Currency translation differences

EURm
Gross
Tax
Net

Exchange differences on translating foreign operations
Attributable to non-controlling interests
20
88
(15)
2
3
22
91
(15)
93
98

45
(7)
45
(7)
131
136
(2)
(1)
(2)
(1)
128
133

The tax relating to exchange differences on translating foreign operations is current tax.
22 Fair value and other reserves

Hedging reserve
EURm

Cash flow hedges:
Net fair value (losses)/gains
Transfer of losses to income statement as
adjustment to net sales1
Transfer of gains to income statement as adjustment
to cost of sales1
Cash flow hedges:
Net fair value (losses)/gains
to cost of sales1
Transfer of losses/(gains) as a basis adjustment to
assets and liabilities2
Available-for-sale investments:
Net fair value losses
Cash flow hedges:
Net fair value gains
to cost of sales1
1
2
Tax
Net
Gross
Tax
Net
Gross
Tax
Net
64
(17)
47
64
(17)
47
(129)
14
(115)
(129)
14
(115)
149
149
149
149
(119)
(119)
(119)
(119)
(35)
(3)
(38)
(35)
(3)
(38)
(24)
(18)
(24)
(18)
24
24
24
24
13
(3)
10
13
(3)
10
(1)
(1)
(1)
(1)
(18)
(18)
(1)
(1)
(19)
(19)
30
30
30
30
157
157
157
157
(93)
(93)
(93)
(93)
76
76
(1)
(1)
75
75
Deferred tax for the Groups foreign subsidiaries was not recognized at December 31, 2012, 2011 and 2010 due to valuation adjustments.
Included in the initial acquisition consideration for the Motorola Solutions networks business. Refer to Note 8, Acquisitions and disposals.
98
Total
Gross
In order to ensure that amounts deferred in the cash flow hedging reserve represent only the effective portion of gains and losses on properly
designated hedges of future transactions that remain highly probable at the statement of financial position date, the Group has adopted a
process under which all derivative gains and losses are initially recognized in the consolidated income statement. The appropriate reserve
balance is calculated at the end of each period and recorded in fair value and other reserves.
The Group continuously reviews the underlying cash flows and the hedges allocated thereto, to ensure that the amounts transferred to fair
value reserves during the year ended December 31, 2012, 2011 and 2010 do not include gains or losses on forward exchange contracts that
have been designated to hedge forecasted sales or purchases that are no longer expected to occur.
All the net fair value gains or losses recorded in fair value and other reserves at December 31, 2012 on open forward foreign exchange
contracts, which hedge anticipated future foreign currency sales or purchases, are transferred from the hedging reserve to the consolidated
income statement when the hedged items affect the income statement at various dates up to approximately 15 months from the statement of
financial position date.
23 Issued share capital and share premium

EURm
2012
2011
2010
Share capital
Share premium
0
9 726
18
0
9 726
18
0
8 726
18
Total
9 744
9 744
8 744
Issued capital comprises:

100 073 fully paid ordinary shares
500 fully paid cumulative preference shares
7 194
2 532
18
7 194
2 532
18
7 194
1 532
18
Total
9 744
9 744
8 744
Number of shares
Par value EUR
Share capital EUR
49 999
49 999
25
50
4
4
4
1
199 996
199 996
100
50
Share capital
Ordinary share class
Class A
Class B
Class C
Class D
100 073
Cumulative preference share class
Class CPA
Class CPB
Class CPC
Class CPD
400 142
Number of shares
Par value EUR
Share capital EUR
150
150
100
100
0.01
0.01
0.01
0.01
1.5
1.5
1.0
1.0
500
Annual Report 2012
99
Fully paid ordinary shares
EURm
Number of shares
Share capital
Share premium

Movement
100 073
7 194

Movement
100 073
7 194

Movement
100 073
7 194
100 073
7 194
Each class A share, class B share and class C share confers the right to cast 400 votes and each class D share confers the right to cast 100
votes at the general meeting of Nokia Siemens Networks. Class D shares are not entitled to vote on the appointment, removal or suspension of
managing directors. The class C and class D shares are not entitled to any balance in a share premium reserve. If dividends or other distributions
are made, the shares shall give entitlement to such dividends and other distributions in accordance with the following ratio:
Class A share 1
Class B share 1
Class C share 1/100th
Class D share 4/100th
However, no distributions to holders of class A shares, class B shares, class C shares and class D shares shall be made until the cumulative
preference share premium, cumulative preference shares profit reserves and unrecognized cumulative preference dividends have been fully
distributed to the holders of the cumulative preference shares A, B, C, and D.
Fully paid cumulative preference shares
EURm
Number of shares
Share capital
Share premium

Movement
0
300
1 532

Movement
300
200
1 532
1 000

Movement
500
2 532
500
2 532
Each cumulative preference share confers the right to cast one vote at the general meeting of Nokia Siemens Networks. Cumulative
preference shareholders A and B are entitled to cumulative profit reserves A and B, which is cumulatively 10% of the share par value plus the
share premium. As the cumulative preference share premium A and B and cumulative preference share profit reserves A and B were not fully
distributed on July 1, 2012 the percentage increases annually on July 1 by 1% per year up to a maximum of 13%. Cumulative preference
shareholders C and D are entitled to cumulative profit reserves C and D, which is cumulatively 12% of the share par value plus the share
premium. If the cumulative preference share premium C and D and cumulative preference share profit reserves C and D have not been fully
distributed on July 1, 2014 the percentage shall increase annually on July 1 by 1% per year up to a maximum of 15%.
No distributions of cumulative profit reserves have been made at December 31, 2012. The total amount of cumulative preference share
dividends not recognized at December 31, 2012 is EUR 576 million (EUR 267 million in 2011 and EUR 76 million in 2010).
Distributions of any other reserves or distributions to ordinary shares shall not take place until the cumulative preference share premium,
cumulative preference shares profit reserves and unrecognized cumulative preference share dividends have been fully distributed to the
holders of the cumulative preference shares A, B, C and D.
Legal reserve
Nokia Siemens Networks B.V. has a legal reserve of EUR 66 million (EUR 68 million in 2011 and EUR 45 million in 2010) that is not available for
distribution to its shareholders. The legal reserve consists of the portion of the cumulative share in the income of group companies of Nokia
Siemens Networks B.V. which is restricted from distribution due to Dutch regulatory requirements. The legal reserves are included in the
accumulated deficit in the consolidated statement of financial position.
100
24 Loans and borrowings

The following table presents the carrying amounts of the Groups long-term interest-bearing liabilities, current portion of long-term interestbearing liabilities and short-term borrowings at December 31 (refer to Note 34, Financial and capital risk management):
EURm
2012
2011
European Investment Bank: final maturity January 20151

Nordic Investment Bank: final maturity March 20151
Finnish pension loan: final maturity October 2015
Firstrand Bank Limited: maturity March 2015
Forward Starting Credit Facility term loan: maturity March 2014
Other
50
35
88
44
600
4
150
80
132
821
366
European Investment Bank

Nordic Investment Bank
Finnish pension loan
Firstrand Bank Limited: maturity October 2012
Skandinaviska Enskilda Banken: final maturity June 2012
Other
100
45
44
100
44
91
115
7
195
357
82
3
39
613
148
89
38
124
888
1 140
1 611
Revolving credit facility

Commercial Paper
Borrowings on committed and uncommitted basis
Other
Total loans and borrowings
1 The proceeds of the loan are used to finance investments in research and development in Radio Access Network technology.
In 2011, the Group entered into a forward starting credit facility (FSCF) with major international banks with an available commitment of
EUR1500 million effective from the forward start date of June 1, 2012. This facility replaced the matured EUR 2 000 million revolving credit
facility from 2009. The forward starting credit facility comprises two parts, a revolving credit facility maturing in June 2015 and a term loan
facility that matures in June 2013. In December 2012, the Group made a EUR 150 million repayment of the term loan and agreed on a restated
EUR 1 350 million forward starting credit facility with the lenders which extended the maturity of the remaining EUR 600 million term loan to
March 2014. The forward starting credit facility is used for general corporate purposes and includes financial covenants relating to financial
leverage and interest coverage of the Group. Nokia Siemens Networks B.V. and Nokia Siemens Networks Oy act as the Guarantors for the
facility. At December 31, 2012 EUR 600 million term loan was outstanding (EUR 613 million was drawn under the EUR 2 000 million revolving
credit facility at December 31, 2011) and is included in long-term interest-bearing liabilities. At December 31, 2012 all financial covenants are
satisfied.
Nokia Siemens Networks B.V. acts as the Guarantor for the Finnish pension loan guarantee facility and the EUR 500 million commercial paper
program in Finland. Nokia Siemens Networks B.V. and Nokia Siemens Networks Oy act as the Guarantors for the European Investment Bank
and the Nordic Investment Bank loans. The European Investment Bank and the Nordic Investment Bank loans and the Finnish pension loan
guarantee facility include similar covenants to the restated forward starting credit facility. All the financial covenants are satisfied at December
31, 2012.
The Groups credit facilities are subject to financial covenants and cross default provisions and the Group is in compliance with these at
December 31, 2012. Management believes there is sufficient headroom with respect to the covenants to meet the Groups liquidity needs.
25 Share-based payment
The Group established a share-based incentive program in 2012 under which options are granted to selected employees. The options
become exercisable on the fourth anniversary of the grant date or, if earlier, on the occurrence of certain corporate transactions such as an
initial public offering (IPO).
The exercise price of the options is based on a per share value on grant as determined for the purposes of the incentive program. The options
will be cash-settled at exercise unless an IPO has taken place, at which point they would be converted into equity-settled options. If the
Annual Report 2012
101
awards are cash-settled, the holder will be entitled to half of the share appreciation based on the exercise price and the estimated value of
shares on that date. If an IPO has not taken place by the sixth anniversary of the grant date, the Group will cash out any remaining options. If
an IPO has taken place, equity options remain exercisable until the tenth anniversary of the grant date. The gains that may be made under the
plan are also subject to a cap. The options are accounted for as a cash-settled share-based payment liability based on the circumstances at
December 31, 2012. The fair value of the liability is determined based on the reporting date estimated value of shares less the exercise price of
the options. For the purpose of estimating the share-based payment expense, it is assumed that the cash-settled options would be exercised
immediately by participants upon vesting four years after the grant date.
The total carrying amount for liabilities arising from share-based payment transactions is EUR 11 million at December 31, 2012 and is accrued
in salaries and wages (refer to Note 27, Accrued expenses) in the consolidated statement of financial position.
Refer to Note 5, Employee benefits expense, for the share-based payment expense recognized in the consolidated income statement.
In the event that an IPO does occur, the share-based payment expense related to the equity-settled options will be measured based on the
original grant date fair value.
26 Deferred taxes
EURm
2012
2011
Deferred tax assets:

Inter-company profit in inventory
Tax losses carried forward
Non-current assets1
Current assets, current liabilities and other provisions
Pension
Other temporary differences
Reclassification due to netting of deferred taxes on company level
58
69
81
320
215
28
(301)
51
154
108
320
223
26
(295)
Total deferred tax assets
470
587
Deferred tax liabilities:

Undistributed earnings
Non-current assets1
Current assets, current liabilities and other provisions
Other temporary differences
Reclassification due to netting of deferred taxes on company level
(20)
(39)
(262)
(9)
301
(20)
(58)
(245)
(4)
295
Total deferred tax liabilities
(29)
(32)
Net deferred tax asset
441
555
Tax (charged)/credited to other comprehensive income at end of year

Non-current assets include purchase price accounting related amortization of intangible assets.
At December 31, 2012 the Group has loss carry forwards primarily attributable to foreign subsidiaries of EUR 3 051 million (EUR 1 220 million
in 2011), of which EUR 1 698 million (EUR 47 million in 2011) will expire within ten years.
At December 31, 2012 the Group has loss carry forwards and temporary differences of EUR 6 253 million (EUR 4 151 million in 2011) and EUR
237 million of tax credits (EUR 122 million in 2011) for which no deferred tax assets were recognized in the consolidated financial statements
due to a history of recent losses in certain jurisdictions. The unrecognized deferred tax assets relate primarily to Finland and Germany.
The amount of temporary differences for which no deferred tax assets were recognized was EUR 3 482 million (EUR 3 805 million in 2011)
and the amount of loss carry forwards for which no deferred tax assets were recognized was EUR 2 771 million (EUR 346 million in 2011). EUR
1 548 million of these loss carry forwards (EUR 16 million in 2011) will expire within ten years and EUR 1 223 million (EUR 330 million in 2011) of
these loss carry forwards have no expiry date. Tax credits for which no deferred tax assets were recognized expire within five years.
The recognition of the remaining deferred tax assets is supported by offsetting deferred tax liabilities, earnings history and profit projections in
the relevant jurisdictions.
At December 31, 2012 the Group has undistributed earnings of EUR 347 million (EUR 424 million in 2011) for which no deferred tax liability was
recognized as these earnings are considered to be permanent investments.
102
27 Accrued expenses
EURm
2012
2011
Advance payments
Salaries and wages
Billings in excess of costs incurred1
Social security
VAT
Other taxes
Other
1 080
746
216
151
111
192
688
919
561
260
160
126
234
725
Total
3 184
2 985
Refer to Note 4, Revenue recognition.
1
Other accrued expenses include EUR 370 million (EUR 382 million in 2011) related to customer projects, EUR 90 million (EUR 94 million in
2011) related to research and development expenses as well as various other amounts which are individually insignificant.
Accrued holiday pay is included in salaries and wages in 2012 and has been reclassified from social security for comparability purposes in
2011. There is no change in total accrued expenses as a result of the reclassification.
28Provisions
EURm
Warranty
and
Retrofit
Tax
Restructuring
Project
losses
Other
Total
At January 1, 2011
Charged/(credited) to income statement:
Additional provisions
Changes in estimates
Acquisitions
Reclassification1
Utilized during year
72
90
144
207
126
639
60
(33)
30
(3)
(32)
57
(41)
(1)
74
(38)
(94)
237
(70)
(112)
(169)
216
(113)
5
(1)
(67)
(3)
644
(295)
35
(116)
(363)
(3)
At December 31, 2011
94
105
86
93
163
541
Charged/(credited) to income statement:

Additional provisions
Changes in estimates
Reclassification1
Utilized during year
49
(28)
(2)
(41)
36
(30)
(24)
977
(48)
(447)
248
(65)
(4)
(128)
48
(25)
17
(48)
(7)
1 358
(196)
11
(688)
(7)
72
87
568
144
148
1 019
In 2012, the reclassification of other provisions consists of EUR 26 million from accrued expenses for contractual commitments with vendors, and EUR 9 million to
accounts payable due to a settlement agreement. All other reclassifications relate to divestments (refer to Note 31, Non-current assets and disposal groups classified as
held for sale).
1
Annual Report 2012
103
EURm
2012
2011
Analysis of total provisions at December 31:

Non-current
Current
303
716
106
435
1 019
541
Total
Warranty provisions relate to products sold. The Groups policy for estimating warranty provisions is disclosed in Note 1, Accounting
principles. Outflows of warranty provisions are generally expected to occur within the next 18 months.
Tax provisions include corporate income tax, VAT and other taxes. The timing of outflows related to tax provisions is inherently uncertain.
In 2012, the restructuring provision includes personnel and other restructuring related costs, such as real estate exit costs. Previously, the
restructuring provision was based on personnel costs only and any other restructuring costs were provided for in other provisions. For
comparability purposes, this reclassification was made for 2011. There is no change in total provisions as a result of the reclassification. The
majority of outflows of restructuring provisions are expected to occur over the next two years.
Provisions for project losses relate to onerous contracts. The Groups policy for providing for onerous contracts is disclosed in Note 1,
Accounting principles. Utilization of provisions for project losses is generally expected to occur over the next 12 months.
Other provisions include provisions for various contractual obligations, of which EUR 35 million relates to contractual commitments with
vendors, and provisions of EUR 18 million for infringement of intellectual property rights. Outflows are generally expected to occur over the
next two years.
29 Commitments and contingencies

EURm
Collateral for the Groups commitments

Assets pledged
Contingent liabilities on behalf of Group companies
Other guarantees
Contingent liabilities on behalf of other companies
Other guarantees
Financing commitments
Customer finance commitments1
Venture fund commitments
2012
2011
864
1 191
11
34
9
86
Refer to Note 34, Financial and capital risk management.
The amounts above represent the maximum principal amount of commitments and contingencies.
At December 31, 2012 other guarantees on behalf of Group companies include commercial guarantees of EUR 598 million (EUR 997 million
in 2011) provided to certain customers of the Group in the form of bank guarantees or corporate guarantees issued by some of the Groups
entities. These instruments entitle the customer to claim payment as compensation for non-performance by the Group of its obligations
under network infrastructure supply agreements. Depending on the nature of the guarantee, compensation is payable on demand or subject
to verification of non-performance. The volume of other guarantees has decreased by EUR 327 million mainly due to expired guarantees.
Other guarantees on behalf of other companies represent commercial guarantees issued on behalf of third parties. The increase in volume is
mainly due to the transfer of guarantees in connection with the disposal of certain businesses where contractual risks and revenues have
been transferred, but some of the commercial guarantees have not yet been re-assigned legally.
Financing commitments are available under loan facilities negotiated mainly with the Groups customers. Availability of the amounts is
dependent upon the borrowers continuing compliance with stated financial and operational covenants and compliance with other
administrative terms of the facility. The loan facilities are primarily available to fund capital expenditure relating to purchases of network
infrastructure equipment and services.
104
Venture fund commitments are financing commitments to a fund making initial capital investments in start-up companies. As a limited partner
in the fund, the Group is committed to make capital contributions and entitled to cash distributions according to the respective partnership
agreements.
The Group is party to routine litigation incidental to the normal conduct of business. In the opinion of management, the outcome of such
litigation is not likely to be material to the financial condition or result of operations.
At December 31, 2012 the Group has purchase commitments of EUR 799 million (EUR 529 million in 2011) relating to commitments from
service agreements, outsourcing arrangements and inventory purchase obligations, primarily for purchases in 2013 through 2014.
30 Leasing contracts
The Group leases office, manufacturing and warehouse space under various non-cancellable operating leases. Certain contracts contain
renewal options for various periods of time.
The future costs for non-cancellable leasing contracts are as follows:
EURm
Leasing payments
Operating leases
2013
2014
2015
2016
2017
Thereafter
141
97
69
40
25
102
Total
474
Rental expenses amount to EUR 309 million in 2012 (EUR 261 million in 2011 and EUR 255 million in 2010), including restructuring charges of
EUR 59 million in 2012 (EUR 2 million in 2011 and EUR 14 million in 2010).
31 Non-current assets and disposal groups classified as held for sale

On December 1, 2012 the Group entered into an agreement to sell its Optical Networks business to Marlin Equity Partners. The proposed
transaction involves the complete Optical Networks product portfolio, services offering and existing customer contracts. The transaction is
expected to close in the first half of 2013 and managements best estimate of the loss to be recognized, following the derecognition of assets
and liabilities transferred, amounts to EUR 130 million. On December 5, 2012 the Group signed an agreement to sell its business support
systems (BSS) business, including the billing and charging software products and solutions and related services, to Redknee Solutions Inc.
The transaction is anticipated to close in the first half of 2013. These divestments further enhance the Groups strategic focus on the mobile
broadband business.
The assets and liabilities included in the disposal groups classified as held for sale at December 31 were as follows:
EURm
2012
Non-current assets
Current assets
Inventories
9
91
39
4
143
Current liabilities
Accrued expenses
Provisions
84
6
90
Annual Report 2012
105
The result of discontinued operations, involving the Optical Networks business, and the result recognized on the re-measurement of the
disposal group to fair value less costs to sell, are as follows for the years ended December 31:
EURm
2012
2011
2010
Net sales
Cost of sales
407
(283)
396
(302)
455
(325)
Gross profit
Other expenses
124
(110)
(28)
(20)
(24)
94
(130)
(28)
(18)
130
(136)
(28)
(18)
Loss before tax for discontinued operations

Income tax expense
(58)
(5)
(82)
(5)
(52)
(6)
Loss for the year from discontinued operations
(63)
(87)
(58)
In order to determine the results for the discontinued operations, revenues and costs have been allocated to the business only to the extent
that the Group will no longer be entitled to revenues or incur expenses once the business is disposed of.
Net cash flows from discontinued operations are as follows for the years ended December 31:
EURm
2012
2011
2010
Operating cash flow

Investing cash flow
Financing cash flow
(28)
(12)
(84)
(15)
(55)
(20)
Total cash flow
(40)
(99)
(75)
The financing of the Group is managed on a centralized basis and as such, there are no financing cash flows associated with discontinued
operations.
2011
In 2011, the Group started to implement a strategy to rationalize its business and divest of certain non-core assets. In connection with this
strategy, at December 31, 2011 the Group had entered into disposal agreements or was actively negotiating the sale of certain of its
operations. At December 31, 2011 the Group had assets and liabilities included in several disposal groups classified as held for sale.
Impairment charges totaling EUR 19 million were recognized as a result of measuring these disposal groups at fair value less costs to sell.
Certain of these transactions included contractual provisions that required cash payment by the Group on closing, and possible additional
subsequent payments to be made based on potential employee redundancies within the disposal group. Refer to Note 8, Acquisitions and
disposals.Assets and liabilities included in disposal groups classified as held for sale at December 31 were as follows:
EURm
2011

Inventories
2
31
22
2
57
Provisions
Accounts payable
Accrued expenses
116
6
17
22
161
106
During 2011, due to the changes in the business environment in Egypt, the property in the 6th of October City was reclassified from held for
sale to property, plant and equipment. There was no effect on the income statement as a result of the reclassification. The property in China
was sold during 2011 with a gain of EUR 9 million.
32 Related party transactions

Nokia and Siemens contributed to Nokia Siemens Networks certain tangible and intangible assets and certain business interests that
comprised Nokias networks business and Siemens carrier-related operations. Nokia and Siemens each own approximately 50% of Nokia
Siemens Networks. Nokia has the ability to appoint the Chief Executive Officer of the Group and the majority of the members of the Board of
Directors. Accordingly, Nokia is deemed to have control and thus consolidates the results of Nokia Siemens Networks in its financial
statements. Siemens accounts for its ownership using the equity method of accounting.
Transactions with the Groups shareholders
The Group has a number of contracts with its shareholders, Nokia and Siemens, and their subsidiary companies. Sales transactions with the
parent companies mainly relate to historical contracts agreed by the parent companies prior to the formation of the Group, where the Group
now has an obligation to deliver products or services to fulfill these agreements. The amounts outstanding are unsecured and will be settled
in cash. There have been no guarantees provided or received for any related party receivables or payables. In China, the Group owes
accounts payable of approximately EUR 180 million to Nokia. These accounts payable relate to the networks business before that business
was transferred by Nokia to the Group upon its formation in 2007 and consist of customer receivables collected by the Group on behalf of
Nokia. Management believes that the Group will be asked to repay this payable in the near future.
No expense has been recognized in the period for bad or doubtful debts in respect of the amounts owed by the related parties (EUR 1 million
in 2011 and EUR 0 million in 2010). At December 31, 2012 EUR 1 million (EUR 1 million in 2011) of the valuation allowance for doubtful
accounts relates to amounts owed by various Siemens entities.
During 2012, the Group incurred expenses of EUR 239 million (EUR 386 million in 2011 and EUR 508 million in 2010) receiving products and
services from both shareholders relating to information technology (IT) infrastructure, shared services, leases and software development.
In December 2010, the Group sold a building, situated in Karaportti 8, Espoo, Finland to Nokia for EUR 27 million. The Group then entered
into an operating lease with Nokia to lease the building for 15 years.
The Groups transactions with its shareholders are summarized in the following table:
Purchases of goods
or services
Sales of goods
or services
EURm
Nokia
Siemens
Amounts owed
by related parties
Amounts owed
to related parties
Loan or finance
liability balances
outstanding to
shareholders
2012
2011
2010
2012
2011
2010
2012
2011
2012
2011
2012
2011
5
20
6
23
1
46
93
146
161
225
168
340
34
10
29
7
227
26
242
19
7
32
6
32
The deposits and loans with Nokia are described in the following tables:
2012
Description of loans or other finance receivables and liabilities
Short-term deposit from Nokia Siemens Networks

to Nokia in Venezuela
Short-term loans from Nokia to Nokia Siemens
Networks Finance B.V.
2011
Description of loans or other finance receivables and liabilities
Short-term deposit from Nokia Siemens Networks

to Nokia in Venezuela
Short-term loans from Nokia to Nokia Siemens
Networks Finance B.V.
Amount of loan
in the agreement
currency
Original term
Interest rate at
December 31
Balance at
December 31
VEF 49 million
52 days
1.00%
EUR 7 million
EUR 7 million
7 days
0.02%
EUR 7 million
Amount of loan
in the agreement
currency
Original term
Interest rate at
December 31
Balance at
December 31
VEF 42 million
123 days
2.00%
EUR 6 million
EUR 6 million
7 days
0.71%
EUR 6 million
Annual Report 2012
107
The Group maintains offsetting deposits at Nokia as long as loans from Nokia are outstanding. At December 31, 2012 the interest-free loan
from Siemens granted to the Group to bridge finance for certain payments withheld by a customer was EUR 32 million (EUR 32 million in
2011). The parent companies have provided a committed overdraft facility of EUR 100 million which has not been utilized at December 31,
2012. The overdraft facility can be cancelled by the parent companies at one months notice. No commitment fees are paid on this facility. In
September 2011, the Group received a capital injection of EUR 1 000 million from its parent companies (refer to Note 23, Issued share capital
and share premium).
At December 31, 2012 the Group has deferred contracts with Siemens. These contracts require invoicing to be done by Siemens as the party
with which the original transaction had been contracted, but the risks and revenues related to fulfilling the contractual requirements remained
with the Group when these contracts transferred to the Group after April 1, 2007. The receivables associated with these deferred contracts
with Siemens are included in the above amounts owed by related parties.
Lease transactions with the Groups shareholders
The Group has multiple operating leases with both Nokia and Siemens. These operating leases mainly relate to property and typically have a
lease term of five years or longer. The Group leases this property from Nokia and Siemens to support its network operations around the
world. Total lease expenses paid in 2012 to Nokia and Siemens are EUR 10 million (EUR 19 million in 2011 and EUR 21 million in 2010) and
EUR 29 million (EUR 32 million in 2011 and EUR 41 million in 2010) respectively.
EURm
Nokia
Siemens
2013
2014
2015
2016
2017
Thereafter
6
5
5
5
3
21
24
19
14
7
6
Total
45
70
EURm
2012
2011
2010

Share of other comprehensive income/(loss) of associates
Share of shareholders equity of associates
Sales to associates
Purchases from associates
Receivables from associates
Liabilities to associates
8
4
28
8
147
32
(17)
(2)
19
29
43
13
11
40
15
148
3
8
Leasing payments
Transactions and positions with associates
Board of Directors
The members of the Board of Directors are appointed by the parent companies of the Group. The appointed board members are employees
of the parent companies, except for the Chairman of the Board. No other board members, except the Chairman, receive remuneration or
retirement benefits from the Group for the services they provide as members of the Board of Directors.
There were no loans granted to the members of the Board of Directors at December 31, 2012.
108
Management compensation
The remuneration of the Nokia Siemens Networks senior management team and the Chairman of the Board of Directors during the period
was as follows:
EURm
2012
2011
2010
Short-term employee benefits

Post-employment benefits
Other long-term benefits
Share-based payment expense
20.5
1.0
1.3
4.0
9.4
0.7
5.2
0.6
(0.1)
7.6
0.5
4.8
(0.1)
Total
26.8
15.8
12.8
The number of executive board members ranged from 13 to 15 members during the year (13 to 14 members in 2011 and 12 to 14 members
in2010). The amounts presented above include remuneration to the executive board members only for the time they were on the Executive
Board. In addition to the executive board members, the remuneration to the Chairman of the Board of Directors is included in the amounts
presented above since October 2011. There were no loans granted to the members of the Group Executive Board at December 31, 2012.
33 Notes to the consolidated statement of cash flows

EURm
2012
2011
2010
Other adjustments for:

Scrapping/write-off of property, plant and equipment/intangible assets
Impairment charges (Note 9)
Share-based payment expense/(income)
Post-employment benefits (Note 6)
Other (income)/expenses
9
(8)
37
11
40
(2)
7
17
19
(2)
43
2
7
(11)
2
(5)
45
6
Other adjustments, total
87
86
44
The cash outflows for restructuring and other specific items, excluding impairments and PPA related charges, are EUR 645 million in 2012
(EUR 188 million in 2011 and EUR 510 million in 2010).
Annual Report 2012
109
34 Financial and capital risk management

Risk management at the Group is a systematic and proactive way to analyze, review and manage all opportunities, threats and risks related to
the Groups objectives rather than solely to eliminate risks. The Groups Treasury function focuses on financial risks.
The Groups financial risk management objective is to guarantee cost-efficient funding at all times and to identify, evaluate and hedge financial
risks and optimize cash management processes. There is a strong focus in the Group on protecting shareholder value. Treasury activities
support this aim by (1) minimizing the adverse effects caused by fluctuations in the financial markets on the profitability of the underlying
business, and (2) managing the capital structure of the Group by balancing prudently the levels of liquid assets and financial borrowings.
Treasury activities are governed by policies approved by the Board of Directors. Treasury policy provides principles for overall financial risk
management and determines the allocation of responsibilities for financial risk management in the Group. Operating procedures cover
specific areas such as foreign exchange risk, interest rate risk, use of derivative financial instruments, as well as liquidity and credit risk. The
Group is risk averse in its treasury activities.
(a) Market risk
Foreign exchange risk
The objective of the foreign exchange (FX) risk management activities is to support the Group in protecting shareholder value by minimizing
the effects of uncertainty in the international foreign exchange markets. The main principle is that all major foreign exchange exposures are
identified, analyzed and hedged by the Groups treasury function. Specifically:
Statement of financial position risks from foreign exchange positions in currencies other than the functional currency of the respective
Group entity are identified and hedged on an ongoing basis.
Cash flow risks arising from highly probable forecasted sales and purchases of the Group are identified on a monthly basis and hedged
under hedge accounting for a period of up to 15 months. These forecasted sales and purchases are typically realized within an equivalent
period.
Other forecasted cash flow risks are managed selectively and the related hedges are carried at fair value through profit and loss.
The Group has some exposure due to unhedged risks which consists of exposures in currencies that either cannot be hedged or which are
considered immaterial. In 2012, these currencies represent approximately 2% of the Groups net sales (less than 2% of net sales in 2011).
Exposures are mainly hedged with derivative financial instruments such as forward foreign exchange contracts and foreign exchange
options. The majority of financial instruments hedging foreign exchange risk has a duration of less than a year. The Group does not hedge
forecasted foreign currency cash flows beyond two years.
Since the Group has entities where the functional currency is other than euro, the shareholders equity is exposed to fluctuations in exchange
rates. Equity changes caused by movements in foreign exchange rates are shown as a currency translation difference in the Groups
consolidated financial statements. The Group may use, from time to time, foreign exchange contracts and foreign currency denominated
loans to hedge its equity exposure arising from foreign net investments.
The Group has entities in Venezuela and Belarus where the functional currency is the currency of a hyperinflationary economy. The Group
assessed the entities financial statements in accordance with IAS 29, Financial Reporting in Hyperinflationary Economies. The impact is not
material in 2012 or 2011. In 2010, the Group recorded an expense of EUR 14 million, mainly affected through an increase in financial income
and expenses, as a result of the Groups hyperinflationary accounting assessment for its entity in Venezuela. Hyperinflationary accounting did
not have a material impact on the statement of financial position in 2012 or 2011. Trading in hyperinflationary economies carries a risk of future
devaluation of monetary assets and liabilities. This risk cannot be hedged.
The Group has foreign exchange exposure in Iran which cannot be hedged. Iran does not have a hyperinflationary economy but it is impacted
by international sanctions, foreign currency access is limited, and several exchange rates are available. The Group has therefore elected to
use a rate at which the future cash flows represented by the transaction or balance could have been settled if those cash flows had occurred
at the measurement date. The Group recognized a foreign exchange loss of EUR 109 million due to foreign exchange fluctuations in the
Iranian rial in 2012.
110
The tables below present the currencies that represent a significant portion of the currency mix in outstanding financial instruments at
December 31:
2012
EURm
FX derivatives used as cash flow hedges (absolute net amount)1

FX exposure from statement of financial position items (absolute net amount)2, 3
FX derivatives not designated in a hedge relationship and carried at fair value
throughprofit and loss (absolute net amount)2, 3
2011
EURm
FX derivatives used as cash flow hedges (absolute net amount)1

FX exposure from statement of financial position items (absolute net amount)2, 3
FX derivatives not designated in a hedge relationship and carried at fair value
throughprofit and loss (absolute net amount)2, 3
USD
JPY
CNY
INR
Other
479
1 030
462
128
178
133
142
817
1 155
185
171
68
618
USD
JPY
KRW
ZAR
Other
141
496
467
161
147
146
133
928
469
396
126
156
796
The foreign exchange derivatives are used to hedge the foreign exchange risk from forecasted highly probable cash flows related to sales, purchases and business
acquisition activities. In some of the currencies, especially US dollars (USD) and Japanese yen (JPY), the Group has substantial foreign exchange risks in both estimated
cash inflows and outflows, which have been netted in the table. Refer to Note 22, Fair value and other reserves for more details on hedge accounting. The underlying
exposures for which these hedges are entered into are not presented in the table as they are not financial instruments as defined under IFRS 7, Financial Instruments:
Disclosures.
2
The statement of financial position items and some probable forecasted cash flows which are denominated in foreign currencies are hedged by a portion of foreign
exchange derivatives not designated in a hedge relationship and carried at fair value through profit and loss.
3
The Group has hedged the statement of financial position exposure with a combination of foreign exchange forwards and foreign exchange options.
1
Interest rate risk

The Group is exposed to interest rate risk either through market value fluctuations of statement of financial position items (i.e. price risk) or
through changes in interest income or expenses. Interest rate risk mainly arises through interest-bearing assets and liabilities. Estimated
future changes in cash flows and statement of financial position structure also expose the Group to interest rate risk.
The objective of interest rate risk management is to support the Group in protecting its shareholder value by optimizing the balance between
minimizing uncertainties caused by fluctuations in interest rates and minimizing the consolidated net interest expense.
The interest rate exposure of the Group is monitored and managed centrally by the Groups treasury function. Due to the Groups current
statement of financial position structure, the primary emphasis is placed on managing the interest rate risk of debt.
At December 31, the interest rate profile of the Groups interest-bearing assets and liabilities is presented in the table below:
2012
EURm
2011
Fixed rate
Floating rate
Fixed rate
Floating rate
Assets1
Liabilities2
405
(293)
2 121
(812)
375
(1 128)
1 397
(444)
Assets and liabilities before derivatives

Interest rate derivatives
112
(1)
1 309
(753)
(152)
953
150
Assets and liabilities after derivatives
111
1 309
(905)
1 103
The increase in floating rate assets is primarily due to an increase in bank and cash. In 2012 and 2011, fixed rate assets mainly include available-for-sale investments, cash
equivalents, long-term loans receivable and short-term loans.
2
The increase in floating rate liabilities is primarily due to an increase in long-term loans from financial institutions. The decrease in fixed rate liabilities is mainly due to a
decrease in short-term and long-term loans from financial institutions.
1
Annual Report 2012
111
Value-at-Risk
The Group uses the Value-at-Risk (VaR) methodology to assess the Groups exposures to foreign exchange and interest rate risks. The VaR
based methodology provides estimates of potential fair value losses in market risk sensitive instruments as a result of adverse changes in
specified market factors, at a specified confidence level over a defined holding period. For the Group, the foreign exchange VaR is calculated
using the Monte Carlo method which simulates random values for exchange rates in which the Group has exposures and it takes the
nonlinear price function of certain foreign exchange derivative instruments into account. The variance-covariance methodology is used to
assess and measure the interest rate risk.
The VaR is determined using volatilities and correlations of rates and prices estimated from a one-year sample of historical market data, at a
95% confidence level, using a one-month holding period. To put more weight on recent market conditions, an exponentially weighted moving
average is performed on the data with an appropriate decay factor. This model implies that within a one-month holding period, the potential
loss will not exceed the VaR estimate in 95% of possible outcomes. In the remaining 5% of possible outcomes, the potential loss will be at
minimum equal to the VaR figure and on average, substantially higher.
The VaR methodology relies on a number of assumptions such as: (1) risks are measured under average market conditions, assuming the
market risk factors follow normal distributions; (2) future movements in market risk factors follow estimated historical movements; and (3) the
assessed exposures do not change during the holding period. Thus, it is possible that for any given month, the potential losses at 95%
confidence level are different and could be substantially higher than the estimated VaR.
Foreign exchange Value-at-Risk
The VaR figures for the Groups financial instruments which are sensitive to foreign exchange fluctuations are presented in the table below. As
defined in IFRS 7, Financial Instruments: Disclosures, the financial instruments included in the VaR calculations are: (1) foreign exchange
exposures from outstanding statement of financial position items and other foreign exchange derivatives carried at fair value through profit
and loss which are not in a hedge relationship and are mostly used for hedging statement of financial position items; and (2) foreign exchange
derivatives designated as forecasted cash flow hedges. Most of the VaR is caused by these derivatives as forecasted cash flow exposures
are not financial instruments as defined in IFRS 7 and thus not included in the VaR calculation.
Foreign exchange Value-at-Risk:
EURm
At December 31
Average for the year
Range for the year
2012
2011
42
46
27-60
13
29
13-52
Interest rate Value-at-Risk

Interest rate VaR is calculated using the variance-covariance method to assess and measure interest rate risk. The VaR figures for the
Groups interest rate exposure in the debt portfolio are presented in the table below. Sensitivities to credit spreads are not reflected in the
figures below.
Interest rate Value-at-Risk:
EURm
At December 31
Average for the year
Range for the year
2012
2011
0-1
1
4
1-6
(b) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. Credit risk
arises from bank and cash, fixed income and money-market investments, derivative financial instruments, loans receivable and credit
exposures to customers, including outstanding receivables, financial guarantees and committed transactions. Credit risk is managed
separately for business related exposure and financial credit exposure.
Except for loan commitments given but not used of EUR 34 million in 2012 (EUR 86 million in 2011), the maximum exposure to credit risk is
limited to the book value of the financial assets included in the Groups consolidated statement of financial position.
112
Business related credit risk

The Group aims to ensure the highest possible quality in accounts receivable and loans due from customers. The credit policy sets out the
framework for the management of the business related credit risks in all Group companies and affiliates.
Credit exposure is measured as the total of accounts receivable and loans due from customers and committed credits. At December 31,
2012 accounts receivable excluding allowances for doubtful accounts are EUR 4 231 million. At December 31, 2011 accounts receivable,
excluding allowances for doubtful accounts as well as amounts expected to be uncollectible for acquired receivables, amounted to EUR 5
436 million. Loans receivable are EUR 74 million (EUR 115 million in 2011).
The credit policy requires credit decisions to be based on credit evaluation including credit rating for larger exposures. The Groups rating
policy defines the rating principles, and ratings are approved by the rating committee. Credit risks are approved and monitored according to
the credit policy. Concentrations of customer or country risks are monitored at Group level. When appropriate, assumed credit risks are
mitigated with the use of approved instruments, such as letters of credit, collateral or insurance and sale of receivables.
Accounts receivable do not include any major concentrations of credit risk by customer. The top three customers account for approximately
9.1%, 4.3% and 2.4% (4.4%, 2.5% and 2.5% in 2011) of the Group accounts receivable and loans receivable at December 31, 2012. The top
three credit exposures by country amount to 11.7%, 11.0% and 7.0% (13.3%, 6.2% and 5.6% in 2011). The Group considers the political,
economic and regulatory environment with respect to such concentrations when assessing and managing credit risk.
The Group has provided allowances for doubtful accounts as needed on accounts receivable and loans receivable based on an analysis of
its customers credit quality and credit history. The Group establishes an allowance for doubtful accounts that represents an estimate of
expected losses at the end of the period. All receivables and loans receivable are considered on an individual basis to determine the
allowance for doubtful accounts.
The overall portfolio of the customer accounts receivable includes trade receivables of EUR 2 948 million (EUR 3 642 million in 2011) and
accrued receivables based on the percentage of completion method of accounting of EUR 1 164 million (EUR 1 573 million in 2011).
The Group concluded that the carrying amount of trade receivables that does not create any additional credit risk exposure amounts to EUR
1 562 million at December 31, 2012 (EUR 1 958 million in 2011), as all the contractual cash flows are expected to be recoverable. Of these
receivables, the aggregate value of receivables performing in accordance with the contractual payment terms is EUR 1 463 million (EUR 1
814 million in 2011), while the aggregate value of past due receivables is EUR 100 million (EUR 144 million in 2011). The aging of these past due
receivables is as follows:
EURm
Past due 1-30 days

Past due 31-180 days
More than 180 days
Total
2012
2011
45
32
23
55
60
29
100
144
At December 31, 2012 the gross carrying amount of accounts receivable, related to customer balances for which valuation allowances have
been recognized, is EUR 1 505 million (EUR 1 905 million in 2011). The valuation allowances for these accounts receivable are EUR 120 million
(EUR 110 million in 2011) and the amounts expected to be uncollectible for acquired receivables are EUR 16 million (EUR 111 million in 2011).
Refer to Note 8, Acquisitions and disposals and Note 20, Allowances for doubtful accounts.
At December 31, 2012 and 2011 there are no valuation allowances recognized for customer loans. There are no past due customer loans at
December 31, 2012 (EUR 1 million in 2011, which was paid in January 2012).
At December 31, 2012 and 2011, all accounts receivable under sale of receivables transactions have qualified for asset derecognition.
Financial credit risk
Financial instruments contain an element of risk of loss resulting from counterparties being unable to meet their obligations. This risk is
monitored and managed centrally. The Group minimizes financial credit risk by limiting its counterparties to a sufficient number of major
banks and financial institutions.
In addition, the Group also monitors the total potential financial losses, should its counterparties be unable to fulfill their obligations on the
open derivative contracts the Group has maintained with them on an ongoing basis.
Annual Report 2012
113
(c) Liquidity risk

Liquidity risk is defined as financial distress or extraordinary high financing costs arising due to a shortage of liquid funds in a situation where
business conditions unexpectedly deteriorate and require financing. Transactional liquidity risk is defined as the risk of executing a financial
transaction below fair market value, or not being able to execute the transaction at all within a specific period of time.
The objective of liquidity risk management is to maintain sufficient liquidity and to ensure that it is available fast enough without endangering
its value, in order to avoid uncertainty related to financial distress at all times. The Group ensures a sufficient liquidity at all times by efficient
cash management and by keeping sufficient committed and uncommitted credit lines available.
In September 2011, the Group received a capital injection of EUR 1 000 million from its parent companies to further strengthen the Groups
financial position and support strategic flexibility, productivity and innovation in areas such as mobile broadband and related services. Refer
to Note 23, Issued share capital and share premium. Additionally, the parent companies have provided a committed overdraft facility of EUR
100 million which has not been utilized at December 31, 2012. The overdraft facility can be cancelled by the parent companies at one months
notice. No commitment fees are paid on the facility.
For details of the Groups loans and borrowings, refer to Note 24, Loans and borrowings.
114
The following table is an undiscounted cash flow analysis for both financial assets and financial liabilities that are presented on the
consolidated statement of financial position and off-balance sheet instruments such as loan commitments according to their remaining
contractual maturity.

EURm
Non-current financial assets

Other non-current assets
Current financial assets
Short-term loans receivable1
Cash
Cash flows related to derivative financial assets net settled:
Derivative contracts receipts
Cash flows related to derivative financial assets gross settled:
Derivative contracts payments
Accounts receivable2, 3
Non-current financial liabilities
Long-term liabilities
Current financial liabilities
Cash flows related to derivative financial liabilities net settled:
Cash flows related to derivative financial liabilities gross settled:
Other financial liabilities4
Accounts payable3
Contingent financial assets and liabilities
Loan commitments given undrawn5
Financial guarantee given uncalled
Loan commitments obtained undrawn6
Total
Due within
3 months
Due
between
3 and 12
months
Due
between
1 and 3
years
Due
between
3 and 5
years
Due
beyond
5 years
69
1
39
1
30
39
8
710
1 711
12
8
708
1 711
27
4 943
(4 802)
2 948
3 066
(3 005)
2 334
1 877
(1 797)
614
(901)
(8)
(55)
(838)
(208)
(125)
(83)
(70)
(125)
(55)
(2)
(2)
2 709
(2 724)
(10)
(2 352)
2 318
(2 330)
(10)
(2 213)
278
(280)
113
(114)
(139)
(34)
(28)
(6)
821
97
(9)
733
Annual Report 2012
115

EURm
Non-current financial assets

Other non-current assets
Current financial assets
Short-term loans receivable1
Cash
Cash flows related to derivative financial assets net settled:
Cash flows related to derivative financial assets gross settled:
Accounts receivable2, 3
Non-current financial liabilities
Long-term liabilities
Current financial liabilities
Cash flows related to derivative financial liabilities net settled:
Cash flows related to derivative financial liabilities gross settled:
Other financial liabilities4
Accounts payable3
Contingent financial assets and liabilities
Loan commitments given undrawn5
Financial guarantee given uncalled
Loan commitments obtained undrawn6
Total
Due within
3 months
Due
between
3 and 12
months
Due
between
1 and 3
years
Due
between
3 and 5
years
Due
beyond
5 years
95
1
37
1
53
59
20
900
729
10
19
898
729
49
1
2
4 609
(4 614)
3 642
4 224
(4 230)
2 830
385
(384)
772
40
(402)
(1)
(2)
(265)
(115)
(19)
(387)
(896)
(61)
(809)
(326)
(87)
(3)
(1)
(1)
(1)
4 726
(4 776)
(20)
(2 209)
4 293
(4 311)
(20)
(2 128)
433
(465)
(63)
(18)
(86)
(37)
(49)
1 480
96
1 384
Short-term loans receivable are included in other financial assets.

Accounts receivable maturity analysis does not include receivables accounted for based on the percentage of completion accounting method of EUR 1 164 million
(EUR1573 million in 2011).
3
The fair values of accounts receivable and accounts payable are assumed to approximate their carrying values due to their short-term nature.
4
In 2012, other financial liabilities include EUR 10 million non-derivative short-term financial liabilities (EUR 20 million in 2011). Refer to Note 16, Fair value of financial
instruments.
5
Loan commitments given but undrawn have been included in the earliest period in which they could be drawn.
6
Loan commitments obtained undrawn have been included based on the period in which they expire and include related commitment fees.
1
2
For the above tables, a line-by-line reconciliation to the consolidated statement of financial position is not possible due to the inclusion of
off-balance sheet instruments such as loan commitments and the inclusion of interest receivable and payable.
116
Capital risk management

The Group manages its capital and financing to ensure that entities in the Group will be able to continue as a going concern while maximizing
the return to stakeholders through the optimization of the debt and equity balance.
The Group reviews the capital structure and expected financing requirements on a regular basis. For the Groups operations, the capital
structure has been largely defined by the respective asset contributions of the parent companies on April 1, 2007, subsequent capital
injections from the parent companies and the financing requirements arising from operating and investing activities including restructuring
activities.
EURm
2012
2011
Total loans and borrowings1

Less: Cash and cash equivalents
1 133
(2 418)
1 605
(1 613)
Net cash
Total equity
(1 285)
2 452
(8)
3 814
Total capital
1 167
3 806
Total borrowings comprise long-term interest bearing liabilities, the current portion of long-term loans and short-term borrowings. In 2012, total borrowings are offset by
short-term deposits of EUR 7 million (EUR 6 million in 2011) that were provided by the Group to Nokia and therefore reduce the amount presented in total borrowings above.
Refer to Note 24, Loans and borrowings and Note 32, Related party transactions.
On March 14, 2013 Nokia Siemens Networks B.V., Nokia Corporation and Nokia Finance International B. V. commenced an arbitration under
the rules of the International Chamber of Commerce against Siemens AG. The claimants seek damages for an alleged breach by Siemens
AG of warranties and other clauses in the Framework Agreement dated June 19, 2006 (as amended and restated) between the parties.
Thealleged breaches arise out of a series of contracts entered between Siemens AS and the Norwegian Ministry of Justice and the Police
dated December 22, 2006 immediately prior to the transfer of that contract to Nokia Siemens Networks B.V. and its affiliates. The claimants
seek damages presently estimated at EUR 238 million. The Group is aware that Siemens AG will contest both liability and amount.
Annual Report 2012
117
Company Financial Statements
Company Statement of Financial Position

(before proposed appropriation of result)
As at December 31
EURm
Notes
2012
2011
4 547
11
22
13
4 768
24
7
4 593
4 799
21
6
1
473
27
27
501
Total assets
4 620
5 300
EQUITY AND LIABILITIES

Shareholders equity
Share capital
Share premium
Fair value and other reserves
Accumulated deficit
Loss for the year
0
9 744
133
75
(6 163)
(1 463)
0
9 744
136
(19)
(5 453)
(710)
ASSETS
Non-current assets
Participations in group companies
Deferred tax assets
Current assets
Other financial assets
Other receivables
2
2
3
4
Total equity
2 326
3 698
Provisions
556
19
438
13
575
451
1 684
35
1 096
55
1 719
1 151
Current liabilities
Loans from group companies
Other liabilities
7
8
Total liabilities
2 294
1 602
Total equity and liabilities
4 620
5 300
118
Company Income Statement

EURm
2012
2011
2010
Loss from group companies after taxes

Company loss for the year after taxes
(1 429)
(34)
(662)
(48)
(1 064)
(26)
Loss for the period
(1 463)
(710)
(1 090)
Annual Report 2012
119
Notes to the Company Financial Statements
General notes for the preparation of the

The company financial statements have been prepared in
accordance with the statutory provisions of Part 9, Book 2, of the
Netherlands Civil Code and the firm pronouncements in the Dutch
Accounting Standards as issued by the Dutch Accounting
Standards Board. For the principles for the recognition and
measurement of assets and liabilities and the determination of the
result for its Company Financial Statements, Nokia Siemens
Networks B.V. applies the option provided in Section 2:362 (8) of the
Netherlands Civil Code. This means that the principles for the
recognition and measurement of assets and liabilities and
determination of the result (hereinafter referred to as Accounting
principles) of the Company Financial Statements of Nokia Siemens
Networks B.V. are the same as those applied for the Consolidated
Financial Statements under International Financial Reporting
Standards. For the accounting policies for the Company statement
of financial position and income statement, reference is made to the
notes to the consolidated statement of financial position and income
statement pages 67 to 117.
The financial information relating to Nokia Siemens Networks B.V. is
presented in the Consolidated Financial Statements. In accordance
with section 2:402 of the Netherlands Civil Code, the Company
Financial Statements only contain an abridged income statement.
Definition of Company: Company refers to the financial
statements of the Parent, Nokia
Siemens Networks B.V.
Definition of the Group: The Nokia Siemens Networks B.V.
group of companies (The Parent
and all its subsidiaries).
Commitments and
Refer to Note 29, Commitments
contingencies: and contingencies, in the
Consolidated Financial Statements.
Consolidated Financial
Refer to Note 1, Accounting
Statements: principles: Basis of presentation
section, in the Consolidated
Financial Statements.
Employees of the Company: The Company has two employees.
Directors remuneration: Refer to Note 32, Related party
transactions: Management
compensation section, in the
Consolidated Financial Statements.
Nokia Siemens Networks B.V. Jesper Ovesen (Chairman),
Board of Directors: Timo Ihamuotila, Joe Kaeser,
Barbara Kux, Louise Pentland,
Peter Y. Solmssen and Juha krs.
120
1 Participations in group companies

Group companies and other associated companies in which the
Company exercises significant influence are stated at net equity
value. Significant influence exists when the Company owns, directly
or indirectly through subsidiaries, more than 20% of the voting rights
of the company.
Participations in group companies are initially acquired at the fair
value of identifiable assets and liabilities upon acquisition. Any
subsequent valuation is calculated using the accounting principles
applied in these financial statements. Participations in group
companies with negative equity values are carried at nil. A provision
is recognized when the Company is fully or partially liable for the
obligations of the group company or has the firm intention to allow
the group company to settle its obligations. The long-term loan
receivables are considered as part of the equity consideration when
a provision is necessary.
The following table reconciles the opening and closing balances of
participations in group companies:
EURm
2012
2011
Net carrying amount January 1

Loss from group companies after taxes
Dividend from group companies
Additions, and acquisitions and disposals
Changes in other comprehensive income
Transfers to provisions, net
Other movements
4 768
(1 429)
(75)
1 071
(2)
93
118
3
4 189
(662)
(133)
1 187
38
31
108
10
Net carrying amount December 31
4 547
4 768
The line item additions, acquisitions and disposals includes the

capital injections and disposals done in the participations by the
Company. The material transactions were capital injections in Nokia
Siemens Networks Oy of EUR 900 million in 2012 and EUR 850
million in 2011. Additionally in 2011, there was EUR 315 million in an
internal share deal purchase of Nokia Siemens Networks Japan Co.
Ltd. by Nokia Siemens Networks B.V. from Nokia Siemens Networks
Oy.
Participations in group companies at December 31, 2012:
Name
Place of residence
and country
Full consolidation
Nokia Siemens Networks MEA FZ-LLC
Nokia Siemens Networks Afghanistan LLC
Nokia Siemens Networks CJSC
Nokia Siemens Networks Argentina S.A.
Nokia Siemens Networks Holdings sterreich GmbH
Nokia Siemens Networks sterreich GmbH
Nokia Siemens Networks Australia Pty. Ltd.
Nokia Siemens Networks Baku LLC
Nokia Siemens Networks Banja Luka d.o.o.
Nokia Siemens Networks d.o.o. za mrezne sisteme, Sarajevo
Nokia Siemens Networks Bangladesh Ltd.
Nokia Siemens Networks N.V.
Nokia Siemens Networks EOOD
Nokia Siemens Networks Bolivia S.A.
Nokia Siemens Networks Servios Ltda.
Nokia Siemens Networks do Brasil Sistemas de Comunicaes Ltda.
IRIS Telekom FLLC
Nokia Siemens Networks LLC
Nokia Siemens Networks Canada Inc.
Nokia Siemens Networks Schweiz AG
Nokia Siemens Networks Chile Ltda.
Hunan Hua Nuo Technology Co. Ltd.
Nokia (Beijing) Communication Technology Service Co. Ltd.
Nokia Siemens Networks (Beijing) Communications Ltd.
Nokia Siemens Networks (China) Ltd.
Nokia Siemens Networks (Suzhou) Supply Chain Services Co. Ltd.
Nokia Siemens Networks (Tianjin) Co. Ltd.
Nokia Siemens Networks Technology (Beijing) Co. Ltd.
Nokia Siemens Networks Technology Service Co. Ltd.
Nokia Siemens Networks (Hangzhou) Co. Ltd.
Nokia Siemens Networks (Shanghai) Ltd.
Nokia Siemens Networks (Suzhou) Co. Ltd.
Nokia Siemens Networks Neusoft Commtech Co. Ltd.
Nokia Siemens Networks System Co. Ltd.
Nokia Siemens Networks Colombia Ltda.
Nokia Siemens Networks Costa Rica S.A.
Nokia Siemens Networks Czech Republic s.r.o.
Nokia Siemens Networks Beteiligungen Inland GmbH & Co. KG
Nokia Siemens Networks Beteiligungen Inland Management GmbH
Nokia Siemens Networks Deutschland GmbH
Nokia Siemens Networks GmbH & Co. KG
Nokia Siemens Networks International Holding GmbH
Nokia Siemens Networks Management GmbH
Nokia Siemens Networks Management International GmbH
Nokia Siemens Networks Operations GmbH
Nokia Siemens Networks Optical GmbH
Nokia Siemens Networks Services GmbH & Co. KG
Nokia Siemens Networks Services Management GmbH
Nokia Siemens Networks Transfergesellschaft mbH
Nokia Siemens Networks Vermgensverwaltung GmbH
Nokia Siemens Networks Vorratsgesellschaft 6 mbH
Nokia Siemens Networks Danmark A/S
Nokia Siemens Networks Algrie SARL
Nokia Siemens Networks Ecuador S.A.
Nokia Siemens Networks O
Nokia Siemens Networks Egypt LLC
Dubai, United Arab Emirates

Kabul, Afghanistan
Yerevan, Armenia
Buenos Aires, Argentina
Vienna, Austria
Vienna, Austria
Sydney, Australia
Baku, Azerbaijan
Banja Luka, Bosnia-Herzegovina
Sarajevo, Bosnia-Herzegovina
Dhaka, Bangladesh
Turnhout, Belgium
Sofia, Bulgaria
Cochabamba, Bolivia
Sao Paolo, Brazil
Sao Paolo, Brazil
Minsk, Belarus
Minsk, Belarus
Mississauga, Canada
Zrich, Switzerland
Santiago, Chile
Changsha, China
Beijing, China
Beijing, China
Beijing, China
Suzhou, China
Tianjin, China
Beijing, China
Beijing, China
Hangzhou, China
Shanghai, China
Suzhou, China
Liaoning, China
Beijing, China
Santafe de Bogota, Colombia
San Jose, Costa Rica
Prague, Czech Republic
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Munich, Germany
Copenhagen, Denmark
Algiers, Algeria
Guayaquil, Ecuador
Tallinn, Estonia
Cairo, Egypt
Group
ownership %
100.00*
100.00**
100.00
100.00
100.00
100.00
100.00*
100.00*
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00*
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
51.00**
60.00
83.90
54.00
83.90
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00*
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00*
Annual Report 2012
121
Name
Place of residence
and country
Nokia Siemens Networks S.A.E.

Telcel S.A.
Nokia Siemens Networks S.L.
Nokia Siemens Networks Asset Management Oy
Nokia Siemens Networks Oy
Nokia Siemens Tietoliikenne Oy
Nokia Siemens Networks France S.A.
Apertio Ltd.
Apertio Partners Ltd.
Invergence Ltd.
Nokia Siemens Networks UK Ltd.
Nokia Siemens Networks Hellas A.E.
Nokia Siemens Networks Guatemala S.A.
Nokia Siemens Networks H.K. Ltd.
Nokia Siemens Networks Honduras S.A.
Nokia Siemens Networks Zagreb d.o.o.
Nokia Siemens Networks Kft
Nokia Siemens Networks TraffiCOM Kft
PT Nokia Siemens Networks
Atrica Ireland Ltd.
Nokia Siemens Networks Ireland Ltd.
Nokia Siemens Networks - Technologies Israel (1990) Ltd.
Nokia Siemens Networks Ethernet Solutions Ltd.
Nokia Siemens Networks Israel Ltd.
Nokia Siemens Networks Pvt. Ltd.
Pishahang Communications Networks Development Company
Nokia Siemens Networks Italia S.p.A.
Nokia Siemens Networks S.p.A.
Nokia Siemens Networks Japan Corp.
Nokia Siemens Networks Kenya Ltd.
Nokia Siemens Networks in Kyrgyzstan LLC
Nokia Siemens Networks Korea Ltd.
Nokia Siemens Networks Kuwait Company W.L.L
Atrica Ltd. (Cayman Islands)
Nokia Siemens Kazakhstan T.O.O.
Nokia Siemens Networks Lanka Pvt. Ltd.
UAB Nokia Siemens Networks
Nokia Siemens Networks S.I.A.
Nokia Siemens Networks Maroc SARL
Nokia Siemens Networks S.R.L.
Nokia Siemens Networks Delivery S.A. de C.V.
Nokia Siemens Networks S.A. de C.V.
Nokia Siemens Networks Servicios S.A. de C.V.
Nokia Siemens Networks Sdn Bhd.
Nokia Siemens Networks Nigeria Ltd.
Nokia Siemens Networks Nicaragua S.A.
Nokia Siemens Networks Finance B.V.
Nokia Siemens Networks Nederland B.V.
Nokia Siemens Networks Norge AS
Nokia Siemens Networks NZ Ltd.
Nokia Siemens Networks Peru S.A.
Nokia Siemens Networks Philippines Inc.
Nokia Siemens Networks Pakistan (Private) Limited
Nokia Siemens Networks Sp. z.o.o
Nokia Siemens Networks Portugal S.A.
Nokia Siemens Networks Romania SRL
Nokia Siemens Networks Srbija d.o.o.
OOO Nokia Siemens Networks
ZAO Nokia Siemens Networks
Cairo, Egypt
Madrid, Spain
Madrid, Spain
Helsinki, Finland
Helsinki, Finland
Helsinki, Finland
Bobigny, France
Bristol, United Kingdom
Huntingdon, United Kingdom
Athens, Greece
Guatemala City, Guatemala
Hong Kong, China
Tegucigalpa, Honduras
Zagreb, Croatia
Budapest, Hungary
Budapest, Hungary
Jakarta, Indonesia
Clare, Ireland
Dublin, Ireland
Hod HaSharon, Israel
New Delhi, India
Tehran, Iran
Milan, Italy
Milan, Italy
Tokyo, Japan
Nairobi, Kenya
Bishkek, Kyrgyzstan
Seoul, South Korea
Safat, Kuwait
George Town, Cayman Islands
Almaty, Kazakhstan
Colombo, Sri Lanka
Vilnius, Lithuania
Riga, Latvia
Rabat, Morocco
Chisinau, Moldova
Mexico City, Mexico
Mexico City, Mexico
Mexico City, Mexico
Kuala Lumpur, Malaysia
Lagos, Nigeria
Managua, Nicaragua
Haarlem, The Netherlands
sGravenhage, The Netherlands
Oslo, Norway
Auckland, New Zealand
Lima, Peru
Makati, Philippines
Islamabad, Pakistan
Warsaw, Poland
Amadora, Portugal
Bucharest, Romania
Belgrade, Serbia
Moscow, Russia
Moscow, Russia
122
Group
ownership %
75.20
100.00
99.90
100.00
100.00
100.00
99.99
100.00
100.00
100.00
100.00
100.00
100.00**
100.00*
100.00* **
100.00
100.00
99.00
100.00
100.00
100.00
100.00*
100.00
100.00
100.00
49.00
100.00
100.00
100.00
100.00
100.00
100.00
49.00
100.00
100.00
100.00
100.00
100.00
100.00*
100.00
100.00
100.00
100.00
100.00
100.00*
100.00* **
100.00
100.00*
100.00
100.00
100.00*
100.00
100.00
100.00
100.00
100.00
100.00
100.00*
100.00
Name
Place of residence
and country
Wireless Technologies Center LLC

Nokia Siemens Networks AB
Nokia Siemens Networks Holdings Singapore Ltd.
Nokia Siemens Networks Singapore Pte. Ltd.
Nokia Siemens Networks d.o.o.
Nokia Siemens Networks Slovakia s.r.o.
Nokia Siemens Networks El Salvador S.A.
Nokia Siemens Networks (Thailand) Ltd.
Nokia Siemens Networks CCC Tunisia SARL
Nokia Siemens Networks Tunisia S.A.
IRIS Telekomnikasyon Mhendislik Hizmetleri A.S .
Nokia Siemens Networks Iletisim A.S .
Nokia Siemens Networks Taiwan Co. Ltd.
Nokia Siemens Networks Tanzania Ltd.
Nokia Siemens Networks Ukraine LLC
OOO MKM Telekom
Nokia Siemens Networks Holdings USA Inc.
Nokia Siemens Networks US LLC
IRIS Telekom Toshkent LLC
Nokia Siemens Networks Tashkent LLC
Nokia Siemens Networks de Venezuela C.A.
Belvory Assets Ltd.
Cartwright Group Ltd.
Nokia Siemens Networks Technical Services Vit Nam Ltd.
Nokia Siemens Networks RSA Pty. Ltd.
Nokia Siemens Networks South Africa Pty. Ltd.
Tomsk, Russia
Stockholm, Sweden
Singapore, Singapore
Singapore, Singapore
Ljubljana, Slovenia
Bratislava, Slovakia
San Salvador, El Salvador
Bangkok, Thailand
Tunis, Tunisia
Tunis, Tunisia
Istanbul, Turkey
Istanbul, Turkey
Taipei, Taiwan
Dar Es Salaam, Tanzania
Kiev, Ukraine
Vyshgorod, Ukraine
Delaware, USA
Delaware, USA
Tashkent, Uzbekistan
Tashkent, Uzbekistan
Caracas, Venezuela
Tortola, British Virgin Islands
Tortola, British Virgin Islands
Phuong Mai, Vietnam
Centurion, South Africa
Centurion, South Africa
Associated companies and other equity stakes

Fujian Funo Mobile Communication Technology Co. Ltd.
Open Cloud Ltd.
TD Tech Holding Ltd.
Carrier Ethernet Solutions
MobiRail V.O.F.
ETSI Technologies Inc.
Site-Con Inc.
Nokia Siemens Networks Al Saudia Ltd.
Fuzhou, China
Cambridge, United Kingdom
Hong Kong, China
Amsterdam, The Netherlands
Rotterdam, The Netherlands
Rizal, Philippines
Makati, Philippines
Riyadh, Saudi Arabia
Group
ownership %
75.00
100.00*
100.00
100.00*
100.00
100.00
100.00**
100.00
100.00
100.00
100.00
100.00
100.00
65.00*
100.00
66.33**
100.00
100.00
100.00
100.00
100.00*
100.00
100.00
100.00
87.00*
100.00
49.00
35.00
51.00
40.00**
50.00
40.00
40.00**
49.00
* Provision recognized Refer to Note 6, Provisions, in the Company Financial Statements.

**In process of liquidation.
Annual Report 2012
123
2 Other non-current assets

In 2012, long-term loans receivable consists of an investment of EUR 22 million (EUR 24 million in 2011) recognized at amortized cost using
the effective interest rate. In 2012, available-for-sale investments consist of an investment of EUR 13 million carried at fair value (EUR 7 million
in 2011).
3 Other receivables
In 2012, other receivables include EUR 11 million of accrued income tax and EUR 9 million intercompany accrued income with other group
companies. In 2011, other receivables of EUR 473 million consist mainly of intercompany accounts receivable with other group companies.
4 Cash and cash equivalents

Cash and cash equivalents are comprised of bank and cash balances.
5 Shareholders equity
Refer to the Consolidated Statement of Changes in Shareholders Equity and Note 23, Issued share capital and share premium, in the
Consolidated Financial Statements for a specification of shareholders equity.
6Provisions
EURm
2012
2011
At January 1
Transfers to participations
438
118
330
108
At December 31
556
438
The provision recognized for participations in group companies relates to the Companys share in the equity deficit since the Company has
assumed liability for the obligations of these group companies. Refer to Note 1, Participations in group companies, in the Company Financial
Statements for the participations provided for at December 31, 2012.
7 Current loans from group companies

EURm
2012
2011
Intercompany cash pool liability

Other current loans from group companies
993
691
1 096
1 684
1 096
Total loans from group companies
The intercompany cash pool liability carries an interest rate of 1 month LIBOR + 2.5%.
Other current loans from group companies consist of short-term loans from Nokia Siemens Networks Finance B.V. with interest rates of 6.6% to 7.2%.
124
8 Other liabilities
EURm
2012
2011
Accrued tax liabilities

Other liabilities
35
4
51
Total
35
55
At December 31, 2012, other liabilities include EUR 14 million of accrued interest expense for intercompany loans, a charge of EUR 11 million
for share-based compensation (refer to Note 25, Share based compensation in the Consolidated Financial Statements) and EUR 7 million of
intercompany accounts payable.
At December 31, 2011 other liabilities consisted mainly of intercompany accounts payable.
9 Audit fees
The following table presents the aggregate fees for professional services and other services rendered by PricewaterhouseCoopers:
EURm
2012
2011
2010
Audit fees
Audit-related fees
Tax fees
10.2
1.4
1.6
10.9
2.3
2.1
9.6
1.2
1.2
Total
13.2
15.3
12.0
The fees listed above relate to the procedures provided to theCompany and its consolidated group companies by PricewaterhouseCoopers
Accountants N.V., the Netherlands, the external auditor as referred to in Section 1(1) of the Dutch Accounting Firms Oversight Act (Dutch
acronym: Wta), and by other Dutch and foreign-based PricewaterhouseCoopers firms, including their tax services and advisory groups.
The total fees of PricewaterhouseCoopers Accountants N.V., the Netherlands, charged to the Company and its consolidated group entities
amounted to EUR 0.1 million for each year presented.
10Guarantees
At December 31, 2012 Nokia Siemens Networks B.V. and Nokia Siemens Networks Oy act as the guarantors for the following:
Restated EUR 1 350 million forward starting credit facility (FSCF)
European Investment Bank loan (EUR 150 million)
Nordic Investment Bank loan (EUR 80 million)
At December 31, 2012 Nokia Siemens Networks B.V. acts as the guarantor for the following:
Commercial paper program in Finland (EUR 500 million), launched in 2010, EUR 82 million issued at December 31, 2012
Finnish pension loan guarantee facility (EUR 132 million)
At December 31, 2012 EUR 600 million term loan was outstanding under the restated EUR 1 350 million FSCF (EUR 613 million outstanding
under the EUR 2 000 million revolving credit facility at December 31, 2011) and all financial covenants are satisfied. The European Investment
Bank and the Nordic Investment Bank loans and the Finnish pension loan guarantee facility include similar covenants to the restated EUR 1
350 million FSCF. All the financial covenants are satisfied at December 31, 2012. Refer to Note 34, Financial and capital risk management, in
the Consolidated Financial Statements.
Nokia Siemens Networks B.V. issued BW2: Article 403 section 1b.C.C.2 statements to third parties for its Dutch wholly-owned subsidiaries,
Nokia Siemens Networks Finance B.V. and Nokia Siemens Networks Nederland B.V.
Commitments and contingencies not included in the statement of financial position
The Company forms a tax group for Dutch corporate income tax purposes with Nokia Siemens Networks Finance B.V. and Nokia Siemens
Networks Nederland B.V. The Company is the head of the fiscal unity and therefore is the relevant tax payer for the Dutch corporate income
tax due for the tax group.
Under the Dutch Collection of State Taxes Act, the Company and its group members that are joined in the tax group for corporate income tax
purposes are still responsible that the relevant corporate income tax due of the tax group is paid by the Company. In the event this is not the
case, the Company and its group members could be jointly and severally liable for the corporate income taxes payable by the tax group.

Annual Report 2012
125
NOKIA SIEMENS NETWORKS B.V.

Board of Directors
Statement of Signatures
Espoo/Munich March 17, 2013
Jesper Ovesen (Chairman)
Louise Pentland
Timo Ihamuotila
Peter Y. Solmssen
Joe Kaeser
Juha krs
Barbara Kux
126
Other information
Proposed profit appropriation

Pursuant to Article 34 of the Articles of Association, distribution of
profits can only be made following the adoption of the annual
accounts which show that such a distribution is possible. The profits
shall be at the free disposal of the general meeting. However, the
Company may only make distributions to shareholders to the extent
that its equity exceeds the total amount of its issued share capital
and the reserves to be maintained pursuant to law. In addition, a loss
may only be applied against reserves maintained pursuant to the law
to the extent permitted by law. Distributions of any other reserves or
distributions to ordinary shares shall not take place until the
cumulative preference share premium, cumulative preference
shares profit reserves and unrecognized cumulative preference
dividends have been fully distributed to the holders of the cumulative
preference shares.
Proposed appropriation of result
The annual general meeting of the shareholders and the Board of
Directors approve the allocation of the results. In a tie voting
regarding a proposal to distribute or reserve profits, the profits
concerned shall be reserved. This is in accordance with the Articles
of Association.
Subsequent events
Refer to Note 35, Subsequent events, in the Consolidated Financial
Statements.
Annual Report 2012
127
Independent auditors report
To: the General Meeting of Shareholders of Nokia Siemens

Networks B.V.
Report on the financial statements
We have audited the accompanying financial statements 2012 of
Nokia Siemens Networks B.V., The Hague as set out on pages 61
to126. The financial statements include the consolidated financial
statements and the company financial statements. The consolidated
financial statements comprise the consolidated statement of
financial position as at 31 December 2012, the consolidated income
statement, the statements of comprehensive income, changes in
shareholders equity and cash flows for the year then ended and the
notes, comprising a summary of significant accounting policies and
other explanatory information. The company financial statements
comprise the company statement of financial position as at 31
December 2012, the company income statement for the year then
ended and the notes, comprising a summary of accounting policies
and other explanatory information.
Directors responsibility
The directors are responsible for the preparation and fair
presentation of these financial statements in accordance with
International Financial Reporting Standards as adopted by the
European Union and as issued by the International Accounting
Standards Board and with Part 9 of Book 2 of the Dutch Civil Code,
and for the preparation of the directors report in accordance with
Part 9 of Book 2 of the Dutch Civil Code. Furthermore, the directors
are responsible for such internal control as they determine is
necessary to enable the preparation of the financial statements that
are free from material misstatement, whether due to fraud or error.
Auditors responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in
accordance with Dutch law, including the Dutch Standards on
Auditing. This requires that we comply with ethical requirements and
plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors judgment, including
the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
companys preparation and fair presentation of the financial
statements in order to design audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the companys internal control. An
audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of accounting estimates
made by the directors, as well as evaluating the overall presentation
of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
128
Opinion with respect to the consolidated financial statements

In our opinion, the consolidated financial statements give a true and
fair view of the financial position of Nokia Siemens Networks B.V. as
at 31 December 2012, and of its result and its cash flows for the year
then ended in accordance with International Financial Reporting
Standards as adopted by the European Union and as issued by the
International Accounting Standards Board and with Part 9 of Book 2
of the Dutch Civil Code.
Opinion with respect to the company financial statements
In our opinion, the company financial statements give a true and fair
view of the financial position of Nokia Siemens Networks B.V. as at
31 December 2012, and of its result for the year then ended in
accordance with Part 9 of Book 2 of the Dutch Civil Code.
Report on other legal and regulatory requirements
Pursuant to the legal requirement under Section 2: 393 sub 5 at e
and f of the Dutch Civil Code, we have no deficiencies to report as a
result of our examination whether the directors report, to the extent
we can assess, has been prepared in accordance with Part 9 of
Book 2 of this Code, and whether the information as required under
Section 2: 392 sub 1 at b-h has been annexed. Further we report
that the directors report, to the extent we can assess, is consistent
with the financial statements as required by Section 2: 391 sub 4 of
the Dutch Civil Code.
Amsterdam, 17 March 2013
PricewaterhouseCoopers Accountants N.V.
C.J. van Zelst RA
Glossary
2G (Second Generation Mobile Communications):

2G cellular telecom networks were commercially
launched on the GSM (Global System for Mobile
Communications) standard. 2G introduced data
services for mobile, starting with SMS text messages.
EICC (Electronic Industry Citizenship

Coalition): A coalition of companies targeting at
improving social, economic, and environmental
conditions in the global electronics supply chain
through use of a standardized code of conduct.
3G (Third Generation Mobile Communications):

The third generation of mobile communications
standards designed for carrying both voice and data.
Flexi Zone: A number of Flexi small cells which can

be meshed together in a zone which collectively act
as a single but distributed macro cell.
4G (Fourth Generation Mobile

Communications): The fourth generation of mobile
communications standards (like Long-Term Evolution,
LTE) optimized for data and providing true broadband
Internet access for mobile devices.
GeSI (Global e-Sustainability Initiative): An

initiative to further promote and support sustainable
development in the information and communications
technology sector.
Base station: A network element in a mobile

network responsible for radio transmission and
reception to or from a mobile device.
GSM (Global System for Mobile

Communications): A digital system for mobile
communications that is based on a widely accepted
standard and typically operates in the 900 MHz,
1800 MHz and 1900 MHz frequency bands.
Customer Experience Management (CEM)

Software suite used to manage and improve the
customer experience, based on customer, device
and network insights.
HSPA (High-Speed Packet Access): A wideband

code division multiple access feature that refers to
both 3GPP high-speed downlink packet access and
high-speed uplink packet access.
CEM on Demand: An intelligent portal offering a

single entry point to customer centric insight and
actions, even down to the individual customer. Insight
is based on key performance indicators linking to
prioritized actions with the most impact on the
business and customer experience.
IP Multimedia Subsystems (IMS): Architectural

framework designed to deliver IP based multimedia
services on telco networks. Standardized by 3GPP.
Cloud (computing): The use of computing

resources hardware and software that are
delivered as a service over a network, typically the
Internet.
Liquid Applications: Applications which can be

hosted on an IT server blade attached directly to a
base station.
CDMA (Code Division Multiple Access):

A digital cellular technology that uses spreadspectrum techniques.
Liquid Core: A product suite enabling dynamic

capacity allocation across the different core network
functions.
Annual Report 2012
129
Glossary
130
LTE (Long-Term Evolution): The fourth generation

of mobile communications designed to provide
high-speed broadband over a flat, all-IP network.
Subscription: The contract between a mobile

phone subscriber and the network carrier for its
mobile phone services.
Operations Support Systems (OSS):

The software systems handling management,
assurance and fulfillment for both networks and
services.
TETRA (Terrestrial Trunked Radio):

Aprofessional mobile radio and two-way transceiver
specification.
Packet Core (or Evolved Packet Core, EPC):

A framework for providing voice and data services
over a network.
TD-LTE (Time Division Long-term Evolution):

An alternative standard for LTE mobile broadband
networks.
Radio Access Network (RAN): A mobile

telecommunications system consisting of switching
centers, radio base stations and transmission
equipment.
WCDMA (Wideband Code Division Multiple

Access): A third generation mobile wireless
technology that offers high data speeds to mobile
and portable wireless devices.
Subscriber: The term used to refer to a person that

has an account with a mobile network carrier.
Wi-Fi: A technology that allows an electronic device

to exchange data wirelessly (using radio waves) over
a computer network, including high-speed Internet
connections.
Subscriber Data Management (SDM):

Technology providing unified management
of network subscriber data.
WiMAX (Worldwide Interoperability for

Microwave Access): A technology of wireless
networks that operates according to the 802.16
standard of the Institute of Electrical and Electronics
Engineers (IEEE).
Annual Report 2012
131
132
Mailing address
P.O. Box 1
FI-02022 Nokia Siemens Networks
Finland
Visiting address
Karaportti 3
02610 Espoo
Finland
+358 (0)7140 04000
nokiasiemensnetworks.com
Registered address
Nokia Siemens Networks B.V.
Werner von Siemensstraat 7
2712 PN Zoetermeer
The Netherlands
Designed by Further
furthercreative.co.uk
This report has been printed in the UK by Pureprint Group, a

CarbonNeutral company, using their environmental printing
technology. Vegetable based inks were used throughout. The cover
and text pages 160 of the report have been printed on Amadeus
50Gloss which is made from 50% post-consumer waste, and 50%
virgin wood fibre. Text pages 61-132 have been printed on paper
produced from pulps sourced from fully sustainable forests and has
been made without the use of elemental chlorine (ECF). Both
manufacturing mills and printer are FSC certified and have been
accredited with ISO14001 environmental management system
Copyright 2013 Nokia Siemens Networks.

All rights reserved.
Nokia is a registered trademark of Nokia Corporation,
Siemens is a registered trademark of Siemens AG.
www.nokiasiemensnetworks.com

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Notes to the Consolidated Financial Statements

Nokia Siemens Networks

12 Chief Executive Officers

Enabling a mobile world

118 Company Statement

127 Proposed profit

Visit our Annual Report online

Enabling a mobile world

Weve focused our business on mobile

Annual Report 2012

A word from our customer

Helping to build customer loyalty

Read more about

Country: United States

Nokia Siemens Networks

Enabling a mobile world

Overview Who we are and what we do

The worlds mobile

Nokia Siemens Networks,

Across the world, the demand to be connected anywhere, anytime,

Our business units

Nokia Siemens Networks

Named number one

Only company supplying

Deployed networks that help people stay

Annual Report 2012

Overview 2012 highlights

Execution, progressand momentum

In 2012, Nokia Siemens Networks made

Full-year sales of 13 372m, down slightly from 13 645m

Significant improvement in gross margin before specific items*

Rigorous working capital management helped to drive positive

Key financials 2012

Nokia Siemens Networks

Achieved world record 4G mobile

Flexi Zone is by far the most innovative

Through selectively exiting non-core

Demonstrated our commitment

Introduced industry award winning

Unveiled industry award-winning Flexi

Launched the first vendor operated

Demonstrated the reliability of core

We are delighted that Nokia Siemens

Developed the groundbreaking Liquid

Maintained the lead and strong

Nokia Siemens Networks mobile

Annual Report 2012

Overview A letter from our Chairman

A year of significant progress

In this letter my first as Chairman of NokiaSiemens

The longer term view of Nokia

To be clear, however, our work is not yet done, and significant

* Excluding specific items.

Nokia Siemens Networks

Overview Our Board of Directors

To find out more about

Annual Report 2012

A word from our customer

Readying the network for iPhone 5

Read more about our work with SoftBank

Nokia Siemens Networks

Chief Executive Officers strategic review

Business review Chief Executive Officers strategic review

Flexi Zone is by far the most innovative

Through selectively exiting non-core

We are delighted that Nokia Siemens

Nokia Siemens Networks mobile

* Excluding specific items.

49% of customers agree that their

Source: Nokia Siemens Networks Acquisition