Key Takeaways
- Nokia’s Q1 comparable operating profit surged 54% year-over-year to €281 million, surpassing analyst projections
- Revenue from AI and cloud customers skyrocketed 49%, with the company securing €1 billion in fresh orders
- The company elevated its Network Infrastructure growth forecast to 12–14% and Optical+IP guidance to 18–20%
- NOK shares climbed nearly 7% in Helsinki, reaching their strongest level since April 2010
- Northland boosted its price target to $13; major institutional investors including Calamos, Millennium, and Goldman Sachs expanded their stakes
Nokia shares climbed to their highest point in sixteen years following an impressive first-quarter performance, fueled by robust demand in AI and optical networking sectors that significantly exceeded market expectations.
The Finnish telecommunications equipment maker reported comparable operating profit of €281 million for the first quarter of 2026, representing a 54% year-over-year increase and topping the €250 million analyst consensus.
Total net sales reached €4.5 billion, marking a 4% annual increase. Earnings per share matched expectations at $0.06, while revenue of $5.27 billion substantially exceeded the $4.59 billion analyst projection.
Shares jumped nearly 7% during early Helsinki trading on April 23, reaching levels not seen since April 2010. On the New York Stock Exchange, NOK advanced 1.4% to $10.48 on Friday, trading within a 52-week range of $4.00 to $10.90.
Revenue generated from AI and cloud customers expanded 49% during the quarter. The company secured €1 billion worth of new AI and cloud contracts, achieving a book-to-bill ratio exceeding 1.0.
Company Dramatically Increases AI Market Size Projections
Nokia significantly updated its addressable market forecast for AI and cloud, now projecting a 27% compound annual growth rate between 2025 and 2028. This represents a substantial revision from the 16% CAGR estimate provided during its November 2025 investor presentation.
Guidance for the Network Infrastructure segment was upgraded to 12–14% growth for 2026, a notable increase from the previous 6–8% forecast. The Optical and IP segment outlook received a similar boost to 18–20%.
The Optical Networks division posted 20% sales growth in the first quarter. Integration efforts with Infinera are progressing ahead of expectations, and the company announced an expanded product lineup featuring a multi-rail amplifier and modular optical engines.
CEO Justin Hotard indicated the company is “currently tracking somewhat above the mid-point” of its full-year comparable operating profit guidance range of €2.0–2.5 billion.
A second indium-phosphide manufacturing facility located in San Jose is scheduled to commence operations later this year, expanding the company’s optical production capabilities.
Wall Street Upgrades and Institutional Accumulation
Northland Securities raised its NOK price target to $13 from $10, highlighting accelerating demand for AI optical connectivity solutions. Bank of America upgraded the stock to a “buy” rating with a $12.40 price target earlier in April.
Among 17 analysts covering the stock, the consensus rating stands at “Moderate Buy,” with 10 buy recommendations, 6 hold ratings, and 1 sell rating. The average analyst price target sits at $8.83, although several recent targets have climbed well above this figure.
Institutional investors have been actively accumulating shares. Calamos Advisors expanded its NOK holdings by 28.1% during Q4, bringing its position to approximately 1.95 million shares. Millennium Management dramatically increased its stake by over 6,500% in Q1, adding nearly 2.8 million shares. Goldman Sachs acquired just over 1 million shares in the first quarter, elevating its total position to 12.55 million shares.
The company also increased its quarterly dividend payment to $0.0468 from $0.04. The annualized dividend of $0.19 yields approximately 1.8%, with a record date of April 28 and distribution scheduled for May 12.
Executives noted semiconductor supply constraints and extended order cycles as potential near-term headwinds. The Fixed Networks segment experienced a 13% sales decline, attributed to strategic portfolio optimization efforts.
Short interest in NOK increased roughly 24% in April to approximately 68.2 million shares, though the days-to-cover metric remains modest at 0.7.
As of Friday’s close, Nokia’s market capitalization stood at approximately $60 billion, with shares trading at a price-to-earnings ratio of 65.29.
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