Good morning. My name is Dennis and I will be your conference operator today. At this time, I would like to welcome everyone to the Nokia fourth quarter and full year 2011 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. (Operator instructions) I will now turn the call over to Mr. Matt Shimao, Head of Investor Relations. Sir, you may begin.

Ladies and gentlemen, welcome to Nokia’s fourth quarter 2011 conference call. I’m Matt Shimao, Head of Nokia Investor Relations. Stephen Elop, President and CEO of Nokia, and Timo Ihamuotila, CFO of Nokia, are here in Espoo with me today. During this call, we will be making forward-looking statements regarding the future business and financial performance of Nokia and its industry. These statements are predictions that involve risks and uncertainties. Actual results may therefore differ materially from the results we currently expect. Factors that could cause such differences can be both external, such as general, economic and industry conditions, as well as internal operating factors. We have identified these in more detail on pages 12 through 39 of our 2010 20-F and in our quarterly results press release issued today. Please note that our quarterly results press release, the complete interim report with tables, and the presentation on our website include non-IFRS results information in addition to the reported results information. Our complete interim report with tables available on our website includes a detailed explanation of the content of the non-IFRS information and the reconciliation between the non-IFRS and the reported information. With that, Stephen, over to you.

Thank you, ladies and gentlemen, for joining us today for the Q4 2011 earnings call. The fourth quarter of 2011 marked a significant step in Nokia's transformation. As I have shared in my previous remarks, a transaction of the magnitude on which we have embarked is significant. And while we progressed in the right direction in 2011, we still have a tremendous amount to accomplish in 2012 in order to properly position Nokia for sustainable long-term growth. We are now in the heart of our transaction. Most notably, in Q4 we introduced new mobile phones and smartphones, further evidence of the strategy shift in our Devices & Services business. Overall, we are pleased with the performance of our mobile phones business, which benefited in Q4 from sequential double-digit percentage growth in our dual SIM business, with particular strength in India, Middle East and Africa, and Southeast Asia. In October, we introduced the Asha 200, 201, 300 and 303, which brought new mobile phones into 76 markets around the world. We are very pleased with the net promoter scores for Asha and consumers are responding positively to Asha’s great data capabilities, elegant design and value for money. The operator channel also is responding positively to Asha, as the devices are bridging the gap between smartphones and feature phones. Because consumers are using their Asha devices for data and Internet, these devices are garnering a higher level of subsidy support from operators compared to traditional feature phones. Additionally, we have reached an important milestone in our mobile phones business. Quite recently, we sold our 1.5 billionth Series 40 device. Furthermore, we are building on this foundation with R&D investments as we continue our journey to bring the Internet to the next billion. Shifting now to our Smart Devices business. In October, just…

Thank you, Stephen. According to our preliminary estimates in terms of unit volumes, the overall handset market in Q4 grew by around 8%, both year-over-year and sequentially. In Q4, our Devices & Services volumes declined 8% year-over-year, but grew 6% sequentially, as Q4 is a seasonally stronger quarter. In Q4, the percentage of our Devices & Services revenue from recently launched products increased, demonstrating that the shift to our new portfolios is underway. Our overall channel inventory increased on a sequential basis in Q4 but continued to be within our normal range of four to six weeks. On a reported basis, Devices & Services net sales of EUR6 billion were up 11% sequentially and down 29% year-over-year. Note that in Q4, we did not have any non-recurring IPR royalty income, whereas in Q3, overall Devices & Services net sales benefited from the recognition of approximately EUR70 million of non-recurring IPR royalty income in Devices & Services other net sales. In Q4, in our Smart Devices, net sales – our Smart Devices net sales increased 25% sequentially, as unit volumes increased by 17% and ASPs increased by 7%. On a sequential basis, Smart Devices net sales benefited from the introduction of new products at the higher end of our portfolio, including the Nokia N9 as well as the Lumia 800 and 710 in selected markets. In Q4, our Mobile Phones net sales grew 4% sequentially, driven by growth in unit volumes and flat ASPs. We continued to broaden the availability of our growth in portfolio in Q4, and in percentage terms, dual SIM units grew strong double digits sequentially. In Q4, we maintained relatively stable prices across our Mobile Phones portfolio on a sequential basis. Also in Q4, we began sales of our new Asha family, which is positioned at the…

Thank you, Timo. For the Q&A session, please limit yourself to one question only. Operator, please go ahead.

(Operator instructions) And the first question comes from the line of Stuart Jeffrey with Nomura. Stuart Jeffrey – Nomura: Hi there. Thanks very much. I wanted to start on the dividends number and maybe you could explain the reasoning behind that. And historically you’ve paid a 30% payout ratio and paying EUR0.20, which obviously is a very high payout ratio. Are you trying to send a signal to the market that you do think that EUR0.50, EUR0.60 of earnings is possible on a sort of a two, three-year objective? And linked to that, you also say you’re in the heart of your transition. And again, should we put those two data points together to conclude that you think the first half really is the low point in your business? And what is it that gives you that confidence that that isn’t sustained through the second half of the year [ph]?

Thanks for the question. I’ll take that. First of all, as it relates to signaling or what have you, the guidance is our principle form of providing guidance. I would have you just focus on guidance as any sort of signaling. The second point I would make is that the primary mechanism for Nokia continues to be the dividend for the distribution of earnings to shareholders and we anticipate that to continue. As it relates to the thought process that went into the dividend, what I can say in general without saying too much about Board-level conversations is that clearly elements like the strength of the current balance sheet were considered, the profits generated in 2011, and also an assessment of the potential sources and uses of cash in the time period ahead. So bringing all of those factors together, the Board is making a recommendation still to be reviewed and voted on by the shareholders of the EUR0.20.

And maybe – Timo here. Just a quick comment on the payout ratio. So last year, we had about the same payout ratio as currently i.e., from about EUR0.60 to EUR0.40 and now from about EUR0.30 to EUR0.20. Just note that – prior that, the payout ratio has been 30% to 40%, yes.

Thank you, Stuart. Operator, next question, please.

Your next question comes from the line of Tim Long with Bank of Montreal. Tim Long – Bank of Montreal: Thank you. Just if you could clarify a little bit more on the greater than normal seasonality in Q1. It sounds like you’re happy with the initial Windows product and it sounds like it’s going to be in a lot more markets and more products of much more availability. So could you balance that with, is it inventory, is it – what is it that’s causing the above normal despite having a much better distribution of some of your new products? Thank you.

Thank you. Timo here. Maybe I will take this and talk a little bit about the Q1 guidance on Devices & Services operating margin and taking that question and that part of it. So first of all, as Stephen said, we are in the heart of our transition and operating with limited visibility, and therefore our guidance is limited. And when we are breaking down the numbers, of course, when you look at the guidance, the three main factors that lead to our Devices & Services operating margin guidance are net sales, which you’re referring to gross margin and OpEx. And on net sales, in Q1, we expect greater than normal seasonal decline, which would naturally lead to also a negative operating leverage. Now we have said that we are seeing pressure in Symbian, which is where we see now in percentage terms the greatest risk of sequential unit decline. And also this year, Chinese New Year occurred early, which shifted some of the revenue towards Q4 and away from Q1. Then the second driver here is gross margin where we do not expect gross margin to be the primary driver or a primary driver of the change in Devices & Services operating margin from Q4 to Q1. And here we anticipate three factors actually. So first, as I indicated in my prepared comments, all the positives, what we benefited or what would have benefited Mobile Phones gross margin during Q4, we are not expecting to sustain in the seasonally weaker Q1. Then on the other hand, in Q1, we don’t expect a similar level of allowances in Smart Devices compared to Q4. And thirdly, we are expecting a higher level of net hedging benefits in Q1. And then finally on OpEx, so due to our investments, we expect a lower than seasonal decline in OpEx during Q1. So while we continue to make progress towards achieving our targets of reducing our longer term operating expenses with more than EUR1 billion by 2013, we are simultaneously continuing to invest to drive our strategy. So we are investing in Smart Devices marketing to support Lumia and we are also investing in Mobile Phones R&D to support the Internet for the next billion strategy. (inaudible) the limited – visibility is limited, our primary combination of top line and OpEx is what we see as the primary drivers for the Q1 operating margin guidance.

Okay. Thanks, Tim. Operator, next question, please.

Your next question comes from the line of Gareth Jenkins with UBS. Gareth Jenkins – UBS: Yes. Thanks. I just wondered if I could follow-up on two things. One, could you just give us a sense of how much the allowances affected your G4 and also the proportion of the EUR180 million Microsoft payment was in terms of P&L impact. And then just second quick one, I was wondering if you could help us with the Asha product family. You gave us good steer on what Lumia did, but can you give us a sense of how Asha is progressing in terms of units? Thank you.

Yes. Timo here. So maybe I’ll start here. So regarding the allowances in Smart Devices, we call that out as one of the drivers that we are quantifying. We are not quantifying it further at this stage, but clearly it was a meaningful number as we called it out as one of the drivers. And then what comes to the platform payment of EUR180 million, so as we have said earlier, we are recording part of that in our Smart Devices cost of goods sold and we did not call this out as a driver, which often also means that that was not a meaningful driver for our gross margin performance in Smart Devices during Q4.

And I’ll take the question on Asha. As I said in my prepared remarks, we’re quite pleased with the progress that Asha is making. The – as I said, the NPS scores, the consumer response is positive and we’re obviously early in the launches with this. So we look at those numbers first. One thing I’d steer you a bit towards in terms of the numbers though is the comments I made about dual SIM because of course there are some dual SIM Asha products that are contributing very much to the dual SIM phenomena that served us very well in Q3 and then again in Q4.

Thanks, Gareth. Operator, next question, please.

Your next question comes from the line of Mark Sue with RBC Capital Markets. Mark Sue – RBC Capital Markets: Thank you. Steve, for Nokia to succeed, Windows has to succeed, and for Windows to succeed, the operators need a vested interest. So I’m just trying to get a sense of the motivation for the carriers to sustain a long period of investment in a third OS beyond the initial trial phase. Do they really want a third OS or do they just want to keep Apple and Android on us and how Nokia might be able to distribute the risk and reward between Microsoft and the operators beyond the initial starting phase?

Very interesting question, because the – it is the case, having even very recently met with a number of the larger operators around the world. The third ecosystem strategic desire from the operators is very strong. It’s something that they believe, if I may speak on some of their behalf, is critical in terms of, from their perspective, maintaining some degree of balance and, if you like, one more knob to control in the context of their revenue mix, their traffic mix and what have you. Recently, I was with one group of operator executives, and one of the comments that was made there that I thought was quite insightful is, if you go into a typical store, there is one corner reserved for a particular ecosystem with bright lights on it and what have you. And that's moving traffic and so forth. And then there is quite a mélange of devices from another ecosystem that if you stand back a few steps and look out, you’ll say, okay, so what’s happening here and maybe there is a Device of the Month, which means next month there will be another Device of the Month. And that's interesting but somewhat similar to the leading ecosystem there. But then what a lot of people are interested in is what’s the alternative, what is the other opportunity, where is the leader in innovation, where are those other capabilities, what’s the alternative point of view? And very much the belief is that the dynamics, both from an operator strategic perspective and also as it relates to what’s going on in the stores and how they manage that environment, they believe the third ecosystem is quite important. So the signs of continued support from the operators is there. I'd refer you to CES. You saw…

Thank you, Mark. Operator, next question, please.

Your next question comes from the line of Kulbinder Garcha with Credit Suisse. Kulbinder Garcha – Credit Suisse: Hi, thanks. I have a couple of clarifications really. And for Stephen, first of all, on Lumia, I take your point, but there has been lots of mixed news commentary in the press, amongst the investment community just a very mixed sell-through. How decent the sell-through is going to be Lumia (inaudible) you sold? And then you also spoke about accelerating Windows Phones’ launch this year. I would have thought that given your product and that is relatively planned out six to nine months, the ability to launch new products earlier may be more challenging. Could you just amplify on that? Then for Timo, on the Symbian allowance, I assume it is non-recurring or is it? That’s my question. And then finally, if it’s not meaningful, then why is it in the press release? I’m kind of confused as to why you bother even calling out if it’s not a meaningful amount. Thanks.

Okay. Thanks for your question. As it relates to sell-through, I think the – when you see different experiences and so forth, obviously what we are focusing on is where and how are those experiences different. So, for example, as I said in my prepared remarks, we do see different experiences and patterns in different countries somewhat related to the competitive dynamics, the brand strength, our retail capability and so forth. And so, for example, a lot of those reports tend to focus on the United Kingdom, which in the context of Europe, is the hardest market in terms of breaking through the strength of the competing ecosystems and so forth. So you see a lot of balance in that direction. But what’s really interesting is – and this is – we are so much in the very early days so that you have to really dig into the details, is even when you are in the UK, and I was there a couple of days ago, and as you can imagine going store to store to store and asking, tell me about smart phones and what’s new and all of that type of thing, you see a great variability of in-store performance in terms of the retail experience. And so, for example, you can go into certain stores where the retail presentation is great, the associates are well-trained, everything is right, and of course, it correlates very closely with the success that we’re seeing in certain chains of stores in certain areas and so forth. Very good performance. And yet in other areas, we’re not as far along as we need to be. We need better retail execution. The associates are not as well prepared or there’s other dynamics at play. The reason I tell you about this variability…

Okay. And then on the Symbian allowance, so – sorry if I was not as clear as I should be. So there is now – there are two topics here, which I was discussing about. There was the Symbian allowance topic and then the platform payment and the impact of the platform payment into the Smart Devices Q4 gross margin. So, two different things here. And regarding the Symbian allowance, this is part of our normal provisions process. It had a meaningful impact on the Q4 Smart Devices gross margin. That’s why we called it out as a driver, but we are quantifying it further. It is non-recurring though as a provision. And then regarding the platform payment, as we have said earlier, we are receiving the platform payment from Microsoft. When the payment comes, it will hit our balance sheet and then we partially recognize that as part of the Smart Devices cost of goods sold. And as I said, that part was not a meaningful driver for Smart Devices gross margin during Q4.

Thank you, Kulbinder. Operator, next question, please.

Your next question comes from the line of Pierre Ferragu with Bernstein. Pierre Ferragu – Bernstein: Good morning, and thank you. I’d just like to ask you a few questions on your gross margin in smartphones. The sort of 20% level that you have today is lower than a lot of your competitors, and how would you interpret that? Does it mean that your product lacks traction in the market? And in that case, is there a significant difference between the gross margin you are realizing today on your new Windows Phones and the Symbian phones? And is there anything else that we would have seen there? Is there something different in your cost structure? Or do you have a different cost terms in your cost structure? Do you have a different cost of goods sold? And then lastly, going forward, I would imagine that’s the level of gross margin that’s not like a long-term gross margin you would like to have in your business. What driver did you see on like two, three years to get back to more – to gross margin more similar to your competitors? Thank you.

Okay, thank you. So maybe – Timo here. Maybe I’ll start this one. So first of all, we are not giving a gross margin guidance. And when we look at the Smart Devices gross margin, so – as was discussed in conjunction with the previous question, we had the Symbian allowance as one of the drivers for the gross margin in Smart Devices. When we look at the gross margin levels, i.e., you referred to this approximately 20%, what we had during Q4. So we can say that the Lumia gross margin is higher than the Symbian gross margin as part of that. But then, when you talk about the gross margin dynamics and driving higher gross margins, so clearly it has to come through innovation and good product.

Yes. Let me comment on that because this is an important pattern to look forward to as it relates to Lumia products. We have shown our first three Lumia products done in record time. It’s important to note that we’ve joined the Windows Phone family of partners late in the software development cycle. And obviously, we moved very quickly on the hardware side getting our first devices out. We’re really proud of what we accomplished in that time. Winning awards in CES and so forth says we are on the right track. But with each successive wave of product introduction with the new hardware, software and services efforts ahead, the opportunity for differentiation is very clearly there. And the way to drive increased gross margin over time is to show that increased differentiation, and we have our sites very clearly set on accomplishing that.

Thanks, Pierre. Operator, next question, please.

Your next question comes from the line of Jeff Kvaal with Barclays Capital. Jeff Kvaal – Barclays Capital: Yes. Thank you very much for the question. Could you comment further please on what you are seeing in smartphone competition? Your commentary suggested that it was primarily in low end in China. I’m wondering if those dynamics apply to other regions. And beyond that, do you feel that your next wave of Windows Phone devices will help you offset the challenges that you’re seeing in the low-end smartphone market? Thank you.

Good. Thanks for the question. As it relates to the China dynamics, the phenomena that’s going on here is that the Chinese operators are increasing and, on an accelerating basis, entering into structure where there is effectively retail rate plan bundling going on at the store. The operators are driving very hard for the volume of 3G data subscribers. And it’s not necessarily an economic measure as it is driving volume on certain networks with certain technologies. I think those targets are probably set more broadly for all of the operators. And the impact of that is that they are discovering that with very low-priced devices on radio technologies that they can drive a lot of volume at those levels. And so we are seeing, for example, a very significant uptick in the number of low-priced devices that are on CDMA. There’s also a very significant focus on the Chinese technology TD-SCDMA. Again, all at the low levels, all to drive these volumes. My comment in the prepared remarks is that Symbian is not well positioned today against that. We do not have Symbian CDMA products at all. So we’re not participating in that part of the market. So, as part of the market grows, our addressable market has gone down because of that. In TD-SCDMA, we do have some products in that space, but not at the price points and configurations that is the real focus of this market. And this is when you look at the numbers, a very substantial trend that has affected us has affected others as well I’m sure. And it’s something that we expect to continue, and that is the principal driver of our comments around the Symbian side. Now, we have not yet announced our specific products for the Chinese market, but I will say that when we first announced our launch plans I think all the way back in October, we did highlight that we would have CDMA-based Windows Phone products and TD-SCDMA Windows Phone products. That being said, it is the case that we have work to do to successively drive the prices down further and further and further. That will take a bit of time, but it’s clearly a pattern that you’re going to see us on in the months ahead. So, we will recognize this phenomenon. I think what we are saying today in our prepared remarks is we’ve seen that they accelerate further, thus the changes in commentary, but nonetheless, it was a phenomena we are well familiar with and something that’s contemplated in our future product plans.

Thank you, Jeff. Operator, next question, please.

Your next question comes from the line of Sandeep Deshpande with JP Morgan. Sandeep Deshpande – JP Morgan: Yes, hi. Thanks. A couple of questions. Firstly, regarding the Windows Phone, I mean, we’ve seen all these. I mean, there was this earlier question on the lack of sell-through or what is happening. I mean, what is it that Nokia can do to differentiate the Windows Phones, whether it is via applications or whether it’s via different retail experience? And what is being considered within Nokia to be able to create a differentiated experience in this regard? And secondly, a quick follow-up on the earlier question on the Chinese market, do you think that the Windows ecosystem is rapidly scalable into this low-end close to $100 smartphone market or is it going to take a couple of years to get there? Thank you.

Great. Thanks very much for your question. In terms of driving differentiation with existing products, we have some very clear points of differentiation. And this is showing up in the retail experience. So, again referring back to last week’s trip in the stores throughout London, for example, one of the very striking experiences that you have and indeed some of the store visits that I had presented it is as such. It was essentially, here is the Lumia opportunity here against here are these 15 devices from Android, for example. And the striking element of it and how it was presented was, let me compare the Android thing to the Windows Phone thing. The reason I highlight that is that’s the first point of differentiation. The overall user experience is differentiated. The Nokia devices with their design absolutely stand out. So, as opposed to being one of a large number of smartphones on the shelf, we are clearly and distinctively standing out that we have to do more work with retail sales associates to have more of those people telling the story to make sure the devices are presented that way more, but there’s clearly a pattern forming where we’re being presented as an alternative to a whole collection of other devices. Now, within the device itself, not only is the design and the principal user interface differentiated, but we’re getting a lot of positive feedback from things like the music service that we’re including, in most markets included in the cost of the device, the location-based services, Nokia Drive, Nokia Maps, and we demonstrated a variety of other of those at CES and earlier at the Nokia World as well. People are also responding to some of the partnerships we're doing. For example, as part of the launch at…

Thank you, Sandeep. Operator, next question, please.

Your next question comes from the line of Francois Meunier with Morgan Stanley. Francois Meunier – Morgan Stanley: Hello, good afternoon, Stephen. Yes. I wanted to understand a bit more of the situation in Europe, in particular, in Q4. It looks like you've done a pretty good increase sequentially both in units and revenues. So I wanted to know you regained market share as you could please tell us if it’s sustainable in Q1 or if it was driven mainly by feature phones or was it with the Symbian phones in Q4?

Thank you, Francois. Operator, I think we have time for just one last question.

Thank you. Today’s final question will come from the line of Ittai Kidron with Oppenheimer. Ittai Kidron – Oppenheimer: I wanted to ask you, Timo, about the Mobile Phone business. You talked about your Symbian business eroding slightly faster than you would have hoped through the year ahead of us. And I’m wondering with the availability of very lower priced 3G devices, as you've talked about, could you see your feature phone business, which is your higher margin business at this point, actually also erode at a much faster pace as the upgrade cycle from feature phone into smartphone potentially accelerates even faster? How do we think about the evolution of that business through the year?

Okay. So, as we have said, I think the big picture here is that we are investing into our Internet for the next billion strategy. And as you have seen us say many times, we are really doing this to blur the divide between the feature phones and smartphones. And in many markets, again, when you walk through a retail, people are not saying, is this a smartphone, is this a feature phone. They are really asking, what does this device do to me? And if you have a good browser, the needed application and so forth, we think we can be competitive on those markets. Having said that, and as we said and as I said also in my prepared remarks, we are not expecting all the positives what impacted the Mobile Phones business gross margin during Q4 to continue going into Q1.

Yes, and I’ll just – let me just add to that and then I’ll wrap the call. As it relates to the Mobile Phones business, while there has been a lot of focus on the transition in the Smart Devices business to the Windows Phone platform, we have highlighted that a key pillar of our strategy is to make R&D investments in the Internet for the next billion strategy. As a result, what we think of as feature phones and how that market perceives is less about the collection of features and what it does or doesn’t do, but it’s more about the price band and the opportunity to drive increased sales in that area to serve consumers who don’t want to spend the money or don’t have the money to spend on what we would today consider a smartphone and so forth. So this is an area where there are certain trends where certain levels of feature may decline in price, but the opportunity to extract value from a certain price band of the market remains quite strong. And that’s something that we are focused on. So, in summary, just to close the call, I wanted to just reiterate, obviously with strong mobile phone performance, as we were just talking about, a continued focus in retail, a major area of focus for us right now is as we get the early experience with Lumia. And with the new excitement around Lumia, including the new device that was launched in the US and the great excitement that we hold in advance of that, we’re clearly driving forward to build long-term value. That’s our focus here. We’ve got a lot of work to do, but we’re very pleased with the progress we are making.

Thank you, Stephen. Ladies and gentlemen, this concludes our conference call. I would like to remind you that during the conference call today, we have made a number of forward-looking statements that involve risks and uncertainties. Actual results may therefore differ materially from the results currently expected. Factors that could cause such differences can be both external, such as general, economic and industry conditions, as well as internal operating factors. We have identified these in more detail on Pages 12 through 39 in our 2010 20-F and in our press release issued today. Thank you.

Ladies and gentlemen, this does conclude today’s Nokia fourth quarter and full year 2011 earnings conference call. You may now disconnect.