The New Nokia Corporation (ADR) (NOK)

Page 1 of 2

The Nokia Corporation (ADR) (NYSE:NOK) we know today will be a drastically different company once its sale to Microsoft Corporation (NASDAQ:MSFT) goes through next year (pending regulatory approval). Its handset devices will be gone, but the Finnish company will still have three key areas it can profit from.

Finding a solution
In an investor presentation earlier this week, Nokia Corporation (ADR) (NYSE:NOK) laid out one of the most important ways it will continue to produce revenue: network solutions. The Nokia Solutions and Networks segment — or NSN — already made up about 45% of the Finnish company’s sales, with $3.6 billion in revenue in the second quarter of this year.

Nokia Corporation (ADR) (NYSE:NOK)NSN makes data and telecommunications equipment and is a “world specialist in mobile broadband” and No. 2 in LTE, according to Nokia Corporation (ADR) (NYSE:NOK). The Wall Street Journal reported recently that NSN made up 90% of Nokia’s revenue in 2012, if you exclude the mobile phone division. Earlier this summer, the company purchased back the 50% stake Siemens AG (ADR) (NYSE:SI) had in NSN, so Nokia will enjoy all of the revenue going forward.

Mapping the here and now
Albeit a smaller part of Nokia Corporation (ADR) (NYSE:NOK)’s overall business portfolio — about 4% right now — the company’s HERE mapping service and platform is used in four out of five cars with in-dash navigation.

Part of Microsoft Corporation (NASDAQ:MSFT)’s purchase of Nokia Corporation (ADR) (NYSE:NOK)’s devices is that the company will also license Nokia’s maps for four years. Nokia said in a presentation that Microsoft will become one of the top three HERE customers and that, “This revenue stream will substantially replace the revenue stream HERE is currently receiving from Nokia’s Devices & Services business internally.”

That’s good news for Nokia Corporation (ADR) (NYSE:NOK) and its investors, considering that revenue from HERE was $307 million in the second quarter of this year. Just a week ago the company launched a new version of HERE Auto — and a companion app — which allows users to download maps so they can access routes without an Internet connection.

Advancing existing tech
Nokia Corporation (ADR) (NYSE:NOK)’s third existing revenue stream will come from its “Advanced Technologies,” which is a fancy name for its patent portfolio. The company has about 10,0000 patent families and 30,000 patents and applications, with about 1,200 of the patent families “declared essential to communications standards.” The company has said that two-thirds of its current patents will still be “in force” over the next 10 years.

Page 1 of 2