Nokia's AI Infrastructure Gambit Fuels 111% Stock Surge as JPMorgan Reaffirms Buy

Nokia stock soars 111% in 2025 as AI and cloud revenue surges 49%. Optical networks and Nvidia partnership drive growth. JPMorgan reiterates overweight with €12 target.

The radical reinvention of Nokia as a cornerstone of the global artificial intelligence buildout is paying off handsomely for shareholders. The Finnish network equipment maker has seen its shares skyrocket 111% since the start of the year, putting the stock on course for its strongest annual performance since 1999. Trading at €11.77, the equity sits just shy of its recent multi-year high hit in mid-May and has nearly doubled compared with its 200-day moving average.

Wall Street’s enthusiasm is grounded in hard operational momentum. JPMorgan recently reiterated its overweight rating on the stock, keeping a €12 price target. Analyst Sandeep Deshpande’s conviction follows a strategy update from CEO Justin Hotard at an investor conference, where the emphasis fell squarely on optical networking and swelling demand from the cloud sector. Deutsche Bank has also chimed in, lifting its target to €8.50.

The numbers from the first quarter provide the backbone for that optimism. Revenue from AI and cloud customers surged 49% year-on-year, while the optical networks division posted a 20% advance. Management credits the broader product portfolio and the integration of Infinera for the early wins. To sustain the pace, Nokia is ramping up capital spending to as much as €1 billion, with the bulk earmarked for expanding optical network production capacity.

Technological partnerships are adding another layer to the story. Nokia is co-developing AI-RAN solutions with Nvidia, aimed at upgrading mobile networks to handle the data deluge of the AI era. On the fixed-network side, new AI features are being baked into broadband gear to improve efficiency. The total addressable market is vast: the telecom industry is projected to spend $6.2 billion on intelligent network technologies by 2030.

Execution now takes center stage. New optical networking solutions are slated for customer sampling in mid-2027, with volume production starting in the second half of that year. Meanwhile, a key factory in San Jose, California is expected to boost output by the end of 2026. For the second quarter, Nokia guided for sequential revenue growth of 5% to 9%, and the full-year operating profit target sits between €2.0 billion and €2.5 billion.

The next major checkpoint arrives on July 23, when Nokia publishes its second-quarter results. If the AI order momentum holds, that report could provide the fundamental underpinning needed to defend the stock’s elevated valuation.