New and amended standards and interpretations

12 Months Ended

Dec. 31, 2025

Disclosure of initial application of standards or interpretations [abstract]

New and amended standards and interpretations

1.4. New and amended standards and

interpretations

On 1 January 2025, Nokia adopted the following amendments

to the accounting standards issued by the IASB and endorsed by

the EU:

▪Amendments to IAS 21 The Effects of Changes in Foreign

Exchange Rates: Lack of Exchangeability

The amendments had no material impact on the measurement,

recognition or presentation of any items in Nokia’s consolidated

financial statements for 2025.

Nokia has not early adopted any new or amended standards or

interpretations that have been issued but are not yet effective.

The new and amended standards and interpretations issued by

the IASB that are effective in future periods are not expected to

have a material impact on the consolidated financial statements

of Nokia when adopted, except for IFRS 18 Presentation and

Disclosure in Financial Statements.

IFRS 18, which was published in April 2024 and will be effective

for annual periods beginning on or after 1 January 2027, will

replace IAS 1 Presentation of Financial Statements.

The objective of IFRS 18 is to enhance the comparability of

financial statements, particularly the income statement,

between companies, improve the transparency and

understandability of non-GAAP measures, and ensure useful

disaggregation of information in the financial statements. To

enable this, IFRS 18 introduces new requirements for

presentation within the income statement, including specified

totals and subtotals and classification of all income and

expenses into one of five categories: operating, investing,

financing, income taxes and discontinued operations, whereof

the first three are new.

Furthermore, the standard requires disclosure of newly defined

management-defined performance measures and aggregation

and disaggregation of financial information based on the

identified ‘roles’ of the primary financial statements and the

notes. In conjunction with the issue of IFRS 18, narrow-scope

amendments have been made to IAS 7 Statement of Cash Flows,

including changing the starting point for determining cash flows

from operations under the indirect method, from ‘profit or loss’

to ‘operating profit or loss’.

Even though IFRS 18 is not changing the recognition and

measurement requirements, the standard is expected to

significantly change how Nokia presents its consolidated

financial statements, particularly the income statement,

statement of cash flows, and notes to the financial statements.

Nokia is currently assessing the impact the adoption will have on

its consolidated financial statements. To date, the following

potential impacts have been identified:

▪Although the adoption of IFRS 18 will have no impact on its

net profit, Nokia expects that grouping items of income and

expenses in the income statement into the new categories

will impact how operating profit is determined. Foreign

exchange differences as well as interest income and

expenses currently aggregated in financial income and

expenses will need to be disaggregated, with some gains or

losses to be presented within the operating category.

Foreign exchange gains and losses as well as interest income

and expenses will be classified in the category where the

related income and expense from the underlying item is

classified.

▪The line items presented on the primary financial

statements might change as a result of the application of

the concept of “useful structured summary” and the

enhanced principles on aggregation and disaggregation.

Nokia does not expect there to be a significant change in the

information that is currently disclosed in the notes because

the requirement to disclose material information remains

unchanged; however, the way in which the information is

grouped might change as a result of the refined

aggregation/disaggregation principles.

▪New disclosures for management-defined performance

measures (MPMs) will be added. In brief, an MPM refers to a

subtotal of income and expenses an entity uses in its

financial communications outside financial statements which

has not been defined in IFRS Accounting Standards. To

improve transparency around these measures, IFRS 18

requires entities to disclose information about all of its

MPMs in a single note, including how the measure is

calculated, how it provides useful information and a

reconciliation to the most comparable subtotal specified by

IFRS Accounting Standards.

▪From the statement of cash flows perspective, the starting

point for calculating cash flows from operating activities will

change to operating profit. Additionally, there will be

changes to how interest received and interest paid are

presented. Interest paid will be presented as financing cash

flows and interest received as investing cash flows, which is

a change from current presentation as part of operating

cash flows.

Nokia will apply IFRS 18 from its mandatory effective date of

1 January 2027. As retrospective application is required, the

comparative information for 2025 and 2026 will be restated

accordingly.