Inside Nokia's 6% Selloff: Why the AI Thesis, Insider Buying and a New Mobile Chief Still Point Higher

Nokia shares dip 6% after 17-year high as crude prices spike, but 186% yearly gain, Nvidia investment, and AI-driven revenue growth signal strong fundamentals.

Nokia's stock hit a 17-year high of EUR 14.97 on Wednesday, then gave back more than six percent the following day as rising crude prices — triggered by renewed Iran-USA tensions — rattled global markets. Technology and networking names bore the brunt, and Nokia, with a 30-day annualised volatility of nearly 80 percent, was an obvious target for profit-taking. At Thursday's close of EUR 13.54, the shares remain more than 30 percent above their 50-day moving average, a reminder that the setback is, so far, a pause in a rally that has lifted the stock 186 percent over the past twelve months.

The retreat says more about macro jitters than about Nokia's business trajectory. The company has been re-rated from a sluggish 5G turnaround story to a pure-play on artificial intelligence infrastructure, a shift cemented in October 2025 when Nvidia invested a billion dollars and took a roughly three percent stake. Together the two firms are advancing AI-RAN technology, with field trials scheduled for this year. Revenue from AI and cloud customers jumped 49 percent year-on-year in the first quarter of 2026, and orders in that segment alone exceeded one billion euros. Optical network infrastructure, driven by hyperscaler data-centre buildouts, rose 56 percent. Nokia subsequently lifted its full-year growth forecast for the optics and IP networks division to 18–20 percent, up from the previous 10–12 percent range.

That momentum has attracted a coordinated wave of analyst upgrades. Morgan Stanley raised its price target from EUR 11 to 14 and kept an "Overweight" rating. Deutsche Bank lifted its target to EUR 8.50, maintaining "Buy". SEB Equities upgraded from "Hold" to "Buy" with a EUR 8.90 target. The upgrades reflect a market consensus that Nokia's old identity — cheap but stuck — no longer applies. Institutional investors have followed suit: 341 funds increased their Nokia positions in the most recent quarter against 212 that trimmed. FMR LLC, the parent of Fidelity, boosted its holding by 34.6 percent, crossing the five percent reporting threshold under Finnish securities law, while Jane Street expanded its stake by nearly 920 percent.

Management has signalled its own conviction through share purchases. CEO Justin Hotard acquired roughly 84,000 Nokia shares on Nasdaq Helsinki at the end of April. In late May, Victoria Hanrahan, Chief of Staff of the CEO, bought more than 22,000 shares at around $16 each on the New York Stock Exchange, and another manager, Owczarek, also reported transactions under the EU Market Abuse Regulation. The amounts are small relative to Nokia's market cap, but as a confidence signal they are hard to ignore.

Structurally, Nokia is tightening the last loose ends of its transformation. In early May it opened an AI Networking Innovation Lab in Sunnyvale, California, to optimise networks for heavy AI workloads in data centres. On the defence side, Nokia Federal Solutions and Lockheed Martin have developed a modular 5G system for US and allied forces based on the CMOSS standard, ready for integration into vehicles and platforms. And from 1 September 2026, Emma Falck — recruited from Siemens where she ran the intelligent-building business — will take charge of the newly formed Mobile Infrastructure division and join Nokia's group leadership, filling a role that had been temporarily managed by CEO Hotard after a strategic disagreement with her predecessor.

All of this forms the backdrop to the earnings report due on 24 July. Nokia's trailing price-to-earnings ratio of roughly 105 reflects expectations that EPS will grow 21 percent in 2026 and 20 percent in 2027. If second-quarter results show that AI orders, margins and cash flow are keeping pace with the share price, Thursday's selloff will look like a momentary blip in an intact uptrend. A slowdown in AI-related bookings, by contrast, would put that valuation under immediate pressure. The next few weeks will determine which scenario unfolds.