Nokia (NOK) Stock Jumps 9% After Q1 Earnings Beat and AI Target Upgrades

TLDR

• Nokia Q1 comparable operating profit rose 54% to €281 million, beating analyst estimates of €250 million
• Net profit came in at €87 million, reversing a €60 million loss from a year ago
• AI and cloud revenue surged 49%, with ~€1 billion in new orders from those customers
• Nokia raised its AI and cloud addressable market growth forecast to 27% annually, up from 16%
• Stock hit its highest price since April 2010, rising as much as 9% in early trading

Nokia’s first quarter came in well ahead of expectations, and the market noticed. The Finnish telecoms gear maker posted comparable operating profit of €281 million, up 54% year-on-year and above the analyst consensus of €250 million.

Net profit swung to €87 million from a loss of €60 million in the same period last year. Operating margin improved to 6.2%, up from 4.2% a year ago.

The stock jumped as much as 9% in early Helsinki trading on Thursday, touching its highest level since April 2010.

Nokia Oyj, NOK

Comparable net sales reached €4.5 billion for the quarter, roughly in line with market estimates, up 4% year-on-year on a constant currency basis.

AI and cloud revenue was the standout performer. It surged 49% and accounted for 8% of group sales. New orders from AI and cloud customers totalled approximately €1 billion in the quarter.

Optical Networks, part of the Network Infrastructure segment, led the way with 20% organic growth. The broader Network Infrastructure segment grew 6% organically. Mobile Infrastructure grew 3%.

AI Market Forecasts Revised Sharply Higher

Nokia lifted its total addressable market growth forecast for AI and cloud to a 27% compound annual rate between 2025 and 2028. That’s up from the 16% it projected at an investor event in November.

Network Infrastructure TAM growth was revised to 12–14% from a prior forecast of 6–8%. Optical and IP networks are now expected to grow 18–20%, versus a previous estimate of 10–12%.

CEO Justin Hotard pointed to the AI “supercycle” as the driver, saying demand was accelerating and prompting increased investment in optical and IP networks.

Nokia reiterated its full-year comparable operating profit guidance of €2.0 billion to €2.5 billion, and said it was tracking somewhat above the midpoint.

Second Quarter Signals Caution

Not everything was rosy. Nokia’s Q2 operating profit guidance came in well below what analysts had pencilled in.

The company guided for Q2 operating profit at 12–16% of full-year operating profit, implying a figure roughly 20% below consensus at the midpoint.

Free cash flow also swung negative, to €-353 million, from a positive €629 million in Q4 2025.

Barclays, which rates Nokia “underweight” with a price target of €5.20, called the quarter “broadly neutral.” The bank flagged near-term disappointment from the weak Q2 profit guidance while acknowledging Nokia’s growing AI exposure.

The brokerage said AI RAN trials were on track but saw “little to get excited about on the mobile side.”

Q2 revenue guidance did imply upside to consensus, with the company guiding for 5–9% sequential growth.

Nokia’s optical business has been a key growth driver following its acquisition of U.S.-based Infinera, which made it one of the world’s top manufacturers of optical transport systems.

AI and cloud orders for the quarter totalled approximately €1 billion, the company confirmed.

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