Nokia’s AI-Led Comeback Accelerates: Stock Triples from Low, Buyback Authorized, But Analyst Targets Lag

Nokia stock more than triples from €3.49 to €11.96 as AI/cloud revenue surges 49%; board authorizes 550M share buyback and €0.14 dividend, but analyst targets lag below current price.

Nokia has completed a remarkable metamorphosis from a mobile-phone relic into a network-equipment player that is now riding the artificial intelligence wave. The stock, which bottomed at €3.49 in August 2025, has more than tripled to close at €11.96 on Friday. Yet the session itself was a reminder that even the hottest rallies face pullbacks: the shares shed roughly 4% on the day, giving back some of the 10% gain accumulated earlier in the week. The 52-week high of €12.55, reached on 13 May, now sits less than 5% above the current price.

Shareholders who attended Nokia’s annual general meeting in April 2026 gave management a powerful tool to sustain momentum. The board was authorized to repurchase up to 550 million own shares, a mandate that runs until October 2027. Alongside the buyback, the meeting approved a maximum dividend or capital repayment of €0.14 per share, with planned tranches extending into early 2027. Neither programme has been activated yet – the authorizations are potential, not executed – but the market is watching closely for the first concrete steps under the new buyback power, possibly as early as the week of 18 May.

Behind this rally lie tangible operational shifts. Nokia has locked in long-term 5G RAN contracts with T?Mobile US and a core?network expansion with the Iliad Group in Europe, both feeding its AirScale portfolio. More importantly, the company has pivoted toward AI?focused network infrastructure. First?quarter 2026 revenue reached €4.5 billion, up 4% year on year, with AI and cloud revenues surging 49% and optical networking climbing 20%. The optical?networks order book alone swelled by €1 billion during the quarter.

Management has sharply raised its growth forecast for the addressable AI and cloud market. Where it previously expected 16% annual expansion, the new projection calls for 27% growth through 2028. Product innovation is keeping pace: on 15 May Nokia announced it would embed generative AI into its converged?charging solution, and three days earlier it unveiled new AI?agent capabilities for fixed?network products. Those announcements align with the broader industry trend – the stock got a mid?week boost from Cisco’s strong quarterly results, which lifted the entire networking sector on 13 May.

Wall Street’s view is more measured than the recent price action suggests. Among 18 analysts covering the stock, 12 rate it a buy and four a hold, while two recommend selling. The average price target of roughly $9.71 (around €9.00 at current exchange rates) sits well below Friday’s close, indicating that the re?rating has outpaced many forecasters’ models. That gap underscores the risk that some of the AI optimism is already priced in.

The coming week brings several potential catalysts. CEO Justin Hotard will appear at the JP Morgan Technology Conference in Boston on 19 May, with investor meetings and a fireside chat planned. Nokia is also a gold sponsor at the International Telecoms Week, where a keynote on “Connectivity 2030” is scheduled. Any new contract announcements or forward?looking comments from those events could provide the next direction cue. Investors will also be watching for whether Nokia announces the first tranche of the new buyback programme.

Structurally, Nokia has trimmed costs by delisting from the Paris exchange at the end of 2025, and has refreshed its board with Timo Ihamuotila as chairman and Thomas Saueressig as vice?chairman. The strategy now concentrates on high?margin network infrastructure and licensing income – two pillars intended to fund the capital returns that shareholders have been promised. The €0.04 per share dividend tranche paid in early May was the first of four scheduled instalments for financial 2025, with the full programme capped at €0.14 per share. Whether the buyback will begin to supplement that payout remains the open question.