Nokia Corporation
Stock Exchange Release
May 23, 2017 at 09:50 (CET +1)
Nokia and Apple sign patent license and business collaboration agreement, settle all litigation
Cupertino, California and Espoo, Finland - Nokia and Apple announced today that they have settled all litigation related to
their intellectual property dispute and agreed a multi-year patent license.
"This is a meaningful agreement between Nokia and Apple," said Maria Varsellona, Chief Legal Officer at Nokia, responsible for
Nokia's patent licensing business. "It moves our relationship with Apple from being adversaries in court to business partners
working for the benefit of our customers."
Under a business collaboration agreement, Nokia will be providing certain network infrastructure products and services to Apple.
Apple will resume carrying Nokia digital health products (formerly under the Withings brand) in Apple retail and online stores, and
Apple and Nokia are exploring future collaboration in digital health initiatives. Regular summits between top Nokia and Apple
executives will ensure that the relationship works effectively and to the benefit of both parties and their customers.
"We are pleased with this resolution of our dispute and we look forward to expanding our business relationship with Nokia," said
Jeff Williams, Apple's chief operating officer.
"This agreement will strengthen our collaboration," said Basil Alwan, President of Nokia's IP/Optical Networks business. "We
look forward to supporting Apple.
While details of the agreement remain confidential, Nokia will receive an up-front cash payment from Apple, with additional
revenues during the term of the agreement.
The value of the agreement will be reflected partially as patent licensing net sales in Nokia Technologies and partially as net
sales in other Nokia business groups. Nokia will follow its existing practices for disclosing patent licensing revenue in its
quarterly announcements and expects that revenues for the agreement will start to be recognized in the second quarter of 2017,
including an element of non-recurring catch-up revenue.
Due to the up-front cash payment from Apple, Nokia intends to provide a comprehensive update of its capital structure
optimization program in conjunction with its third quarter 2017 results.
About Nokia
Nokia is a global leader innovating the technologies at the heart of our connected world. Powered by the research and
innovation of Nokia Bell Labs, we serve communications service providers, governments, large enterprises and consumers, with the
industry's most complete, end-to-end portfolio of products, services and licensing.
From the enabling infrastructure for 5G and the Internet of Things, to emerging applications in virtual reality and digital
health, we are shaping the future of technology to transform the human experience. www.nokia.com
Media Enquiries:
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E-mail: press.services@nokia.com
FORWARD-LOOKING STATEMENTS
It should be noted that Nokia and its businesses are exposed to various risks and uncertainties and certain statements herein
that are not historical facts are forward-looking statements, including, without limitation, those regarding: A) our ability to
integrate Alcatel Lucent into our operations and achieve the targeted business plans and benefits, including targeted synergies in
relation to the acquisition of Alcatel Lucent; B) expectations, plans or benefits related to our strategies and growth management;
C) expectations, plans or benefits related to future performance of our businesses; D) expectations, plans or benefits related to
changes in organizational and operational structure; E) expectations regarding market developments, general economic conditions and
structural changes; F) expectations and targets regarding financial performance, results, operating expenses, taxes, currency
exchange rates, hedging, cost savings and competitiveness, as well as results of operations including targeted synergies and those
related to market share, prices, net sales, income and margins; G) expectations, plans or benefits related to any future
collaboration or to the business collaboration agreement and the patent license agreement between Nokia and Apple announced on May
23, 2017, including income to be received under any collaboration or partnership or agreement; H) timing of the deliveries of our
products and services; I) expectations and targets regarding collaboration and partnering arrangements, joint ventures or the
creation of joint ventures, including the creation of the new Nokia Shanghai Bell joint venture and the related administrative,
legal, regulatory and other conditions, as well as our expected customer reach; J) outcome of pending and threatened litigation,
arbitration, disputes, regulatory proceedings or investigations by authorities; K) expectations regarding restructurings,
investments, capital structure optimization efforts, uses of proceeds from transactions, acquisitions and divestments and our
ability to achieve the financial and operational targets set in connection with any such restructurings, investments, capital
structure optimization efforts, divestments and acquisitions; and L) statements preceded by or including "believe," "expect,"
"anticipate," "foresee," "sees," "target," "estimate," "designed," "aim," "plans," "intends," "focus," "continue," "project,"
"should," "will" or similar expressions. These statements are based on management's best assumptions and beliefs in light of the
information currently available to it. Because they involve risks and uncertainties, actual results may differ materially from the
results that we currently expect. Factors, including risks and uncertainties that could cause these differences include, but are
not limited to: 1) our ability to execute our strategy, sustain or improve the operational and financial performance of our
business and correctly identify and successfully pursue business opportunities or growth; 2) our ability to achieve the anticipated
benefits, synergies, cost savings and efficiencies of the acquisition of Alcatel Lucent, and our ability to implement our
organizational and operational structure efficiently; 3) general economic and market conditions and other developments in the
economies where we operate; 4) competition and our ability to effectively and profitably compete and invest in new competitive
high-quality products, services, upgrades and technologies and bring them to market in a timely manner; 5) our dependence on the
development of the industries in which we operate, including the cyclicality and variability of the information technology and
telecommunications industries; 6) our global business and exposure to regulatory, political or other developments in various
countries or regions, including emerging markets and the associated risks in relation to tax matters and exchange controls, among
others; 7) our ability to manage and improve our financial and operating performance, cost savings, competitiveness and synergies
after the acquisition of Alcatel Lucent; 8) our dependence on a limited number of customers and large multi-year agreements; 9)
exchange rate fluctuations, as well as hedging activities; 10) Nokia Technologies' ability to protect its IPR and to maintain and
establish new sources of patent licensing income and IPR-related revenues, particularly in the smartphone market; 11) our ability
to successfully realize the expectations, plans or benefits related to any future collaboration or to the business collaboration
agreement and the patent license agreement between Nokia and Apple announced on May 23, 2017, including income to be received under
any collaboration or partnership or agreement; 12) our dependence on IPR technologies, including those that we have developed and
those that are licensed to us, and the risk of associated IPR-related legal claims, licensing costs and restrictions on use; 13)
our exposure to direct and indirect regulation, including economic or trade policies, and the reliability of our governance,
internal controls and compliance processes to prevent regulatory penalties in our business or in our joint ventures; 14) our
ability to identify and remediate material weaknesses in our internal control over financial reporting; 15) our reliance on
third-party solutions for data storage and service distribution, which expose us to risks relating to security, regulation and
cybersecurity breaches; 16) inefficiencies, breaches, malfunctions or disruptions of information technology systems; 17) Nokia
Technologies' ability to generate net sales and profitability through licensing of the Nokia brand, particularly in digital media
and digital health, and the development and sales of products and services, as well as other business ventures which may not
materialize as planned; 18) our exposure to various legislative frameworks and jurisdictions that regulate fraud and enforce
economic trade sanctions and policies, and the possibility of proceedings or investigations that result in fines, penalties or
sanctions; 19) adverse developments with respect to customer financing or extended payment terms we provide to customers; 20) the
potential complex tax issues, tax disputes and tax obligations we may face in various jurisdictions, including the risk of
obligations to pay additional taxes; 21) our actual or anticipated performance, among other factors, which could reduce our ability
to utilize deferred tax assets; 22) our ability to retain, motivate, develop and recruit appropriately skilled employees; 23)
disruptions to our manufacturing, service creation, delivery, logistics and supply chain processes, and the risks related to our
geographically-concentrated production sites; 24) the impact of litigation, arbitration, agreement-related disputes or product
liability allegations associated with our business; 25) our ability to optimize our capital structure as planned and re-establish
our investment grade credit rating or otherwise improve our credit ratings; 26) our ability to achieve targeted benefits from or
successfully achieve the required administrative, legal, regulatory and other conditions and implement planned transactions,
including the creation of the new Nokia Shanghai Bell joint venture, as well as the liabilities related thereto; 27) our
involvement in joint ventures and jointly-managed companies; 28) the carrying amount of our goodwill may not be recoverable; 29)
uncertainty related to the amount of dividends and equity return we are able to distribute to shareholders for each financial
period; 30) pension costs, employee fund-related costs, and healthcare costs; and 31) risks related to undersea infrastructure, as
well as the risk factors specified on pages 67 to 85 of our 2016 annual report on Form 20-F under "Operating and financial review
and prospects-Risk factors" and in our other filings with the U.S. Securities and Exchange Commission. Other unknown or
unpredictable factors or underlying assumptions subsequently proven to be incorrect could cause actual results to differ materially
from those in the forward-looking statements. We do not undertake any obligation to publicly update or revise forward-looking
statements, whether as a result of new information, future events or otherwise, except to the extent legally
required.
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