Trading Statement

Nokia Corporation
12 June 2001


Nokia sees slower market growth affecting second quarter results
and takes actions to expand leadership while maintaining strong
profitability

During the first half of this year, Nokia has continued to perform
strongly in the global mobile communications market and has been
able to strengthen its leading market position. However, the
general economic slowdown in the US has recently shown signs of
extending to other regions and to the wireless telecommunications
industry as a whole.

'We have been able to successfully follow our set strategy of
increasing market share in phones and heading for the leadership
position in third generation mobile networks,' says Jorma Ollila,
Chairman and CEO of Nokia. 'However, we have recently seen a
weakening in market conditions to levels below our earlier
estimates. We believe that this slowdown is a result of a general
market deterioration - driven by economic uncertainty, the ongoing
technology transition and less aggressive marketing by the
operators.'

Nokia now estimates the global mobile phone market to show only
very modest growth this year compared to 2000, when about 405
million phones were sold. During the second half of 2001, the
company estimates that the market will be significantly larger
than during the first half. The slower growth is expected to
affect capacity-driven network investments of some operators for
the time being. While it will also lead to slower-than-anticipated
growth in Nokia's sales, the company believes that its mobile
phone business will continue to grow significantly faster than the
market during 2001, and that its network business will achieve an
annual growth rate at least on par with overall market growth.

Nokia also expects weaker market conditions to impact its
financial performance during the second quarter. Based on the
first two months of the current quarter, the company estimates
year-on-year sales growth for the second quarter 2001 to be
somewhat below 10% compared with its earlier estimate of 20%.
Diluted pro forma EPS is estimated to be in the range of EUR 0.15-
0.17 in the second quarter 2001, compared with the previous
estimate of approximately EUR 0.20. In the second quarter 2000,
Nokia's diluted pro forma EPS was EUR 0.21. Backed by the
company's ongoing excellent working capital management and healthy
profitability, Nokia expects to continue to see strong positive
cash flow in the second quarter.

Nokia is currently revisiting its outlook for the second half of
the year, as the market slowdown is expected to continue having an
adverse effect. Updated estimates for the second half of 2001 will
be released on July 19 in conjunction with the company's second
quarter earnings release.

Nokia will continue to take determined actions in all areas of the
business to align its operations with the changing market
conditions. Previously announced moves to increase the company's
efficiency and competitiveness include operational changes to
further enhance customer focus in Nokia Networks, a refocus of
production at Nokia Mobile Phones factories in Texas (US) and
Bochum (Germany), and the re-alignment of Nokia Internet
Communications. The financial impact of these actions will
negatively affect Nokia's reported operating profit in the second
quarter 2001 in the form of a one-time charge of approximately EUR
190 million, which will include restructuring charges, as well as
goodwill write-offs at Nokia Internet Communications.

'While market deterioration has had an inevitable impact on
Nokia's sales growth, our products have remained strong, our
market position has strengthened and we've been able to find
further efficiencies through tight control of our own performance.
As a result, Nokia has been able to maintain a high level of
profitability,' says Jorma Ollila.

'We have intensified our efforts to counter changing market
conditions by accelerating ongoing programs and generating
efficiencies and cost savings. This, in combination with our
current financial health and proven performance, should enable us
to exit the current slowdown in a stronger position than before.
We will, together with our operator customers, continue the
implementation of the new technologies with full speed in order to
support the transition into next generation services.'

It should be noted that certain statements herein which are not
historical facts, including, without limitation those regarding 1)
the timing of product deliveries; 2) the Company's ability to
develop and implement new products and technologies; 3)
expectations regarding market growth and developments; 4)
expectations for growth and profitability; and 5) statements
preceded by 'believes', 'expects', 'anticipates', 'foresees', or
similar expressions, are forward-looking statements. Because such
statements involve risks and uncertainties, actual results may
differ materially from the results currently expected by the
Company. Factors that could cause such differences include, but
are not limited to 1) industry conditions, such as the strength of
product demand, the intensity of competition, pricing pressures,
the acceptability of new product introductions such as Internet-
ready phones, the introduction of new products by competitors, the
impact of changes in technology, including the Company's success
in the emerging 3G market, the introduction and marketing of new
products and services by operators, the ability of the Company to
source components from third parties without interruption and at
reasonable prices, demand for vendor financing and the Company's
ability and willingness to provide such financing, and the success
and financial condition of the Company's strategic partners and
customers; 2) operating factors, such as continued success of
manufacturing activities and the achievement of efficiencies
therein, continued success of product development or inventory
risks due to shifts in market demand; 3) general economic
conditions, such as the rate of economic growth in the Company's
principal geographic markets and in the wireless
telecommunications industry as a whole, or fluctuations in
exchange rates, including impact of the exchange rate between the
euro and the US dollar; as well as 4) the risk factors specified
on pages 21 to 23 of the Company's Form 20-F for the year ended
December 31, 1999.


Further information:

Nokia
Corporate Communications, Finland
Tel. [phone]
Investor Relations, Finland
Tel.+ 358 7180 34289
Investor Relations, USA
Tel. [phone]

www.nokia.com