Nokia's AI Pivot Faces Its Earnings Checkpoint as Shares Hover Near 17-Year Highs

Nokia's stock jumps 156% in 2023, nearing 17-year highs, driven by AI infrastructure demand, Jim Cramer's endorsement, and insider purchases. Q2 earnings on July 23 will test if fundamentals match the hype.

Nokia’s extraordinary run – a 156% advance since January that has lifted the stock to within striking distance of its 17-year peak – now hinges on a single question: can the underlying business keep pace with the narrative? The answer will start to take shape on July 23, when the Finnish network equipment maker reports second-quarter results. Until then, a trio of catalysts has kept the momentum alive: a high-profile endorsement from Jim Cramer, a wave of insider purchases, and accelerating revenue from AI-related customers.

The most visible spark came from CNBC's Mad Money host, who on June 2 devoted a full segment to Nokia’s transformation. Cramer cast the company as a stealth beneficiary of the artificial intelligence infrastructure buildout, highlighting two strategic pillars: optical networking, bolstered by the $2.3 billion acquisition of Infinera, and AI-RAN technology that embeds inference capabilities directly into mobile towers. He gave a qualified thumbs-up – recommending only a small position for investors willing to do their homework – and warned that the stock looked overbought, advising newcomers to wait for a pullback.

That caution has some foundation. With a relative strength index of 67.7, Nokia is nudging into technically stretched territory, and the share price of €14.27 sits about 4.7% below the 52-week peak of €14.97 touched on June 3. The recent drift lower – a 2.66% drop on Thursday to €14.06 – suggests the market is already weighing the gap between hype and delivery. The price-to-earnings multiple has swelled to roughly 100, and the analyst consensus target now lags the current market price, a clear warning that expectations have run ahead of fundamentals.

Yet the company’s insiders have been voting with their wallets. Victoria Hanrahan, chief of staff to CEO Justin Hotard, purchased more than 44,000 shares at a weighted average price of around $15.81 in late May, a total outlay exceeding $706,000. That followed two independent directors buying roughly 15,000 shares in the prior month. Such transactions are often read as a vote of confidence, and in this case they underpin the credibility of Nokia’s pivot from legacy telecom gear to AI-era infrastructure.

The operational scorecard so far supports the optimism. First-quarter net sales to AI and cloud customers surged 49% year on year, and new contracts in the segment have already topped €1 billion. The company upgraded its full-year growth forecast for Network Infrastructure to 12-14%, sharply above the prior 6-8% range. On the bottom line, comparable operating profit jumped 54% to €281 million, beating analyst estimates of around €250 million. For the full year 2026, management targets a comparable operating result between €2.0 billion and €2.5 billion, with a long-term ambition of up to €3.2 billion by 2028.

A key ingredient in the AI narrative is the partnership with Nvidia, which invested $1 billion in Nokia in October 2025 at $6.01 per share. The two are collaborating on AI-RAN software for 5G and 6G radio access networks, with T-Mobile U.S. also joining the effort. The potential payoff, however, is still some way off: analysts expect the big ramp in AI-RAN revenue only from late 2027. Meanwhile, the optical networks business, which grew 20% in the first quarter, is providing a more immediate boost.

Management has also strengthened the bench. Emma Falck, recruited from Siemens, will take over as president of Mobile Infrastructure on September 1. CEO Justin Hotard described her as the right leader for the company’s next chapter. The move fills a key slot as Nokia juggles its legacy mobile networks business with the faster-growing AI infrastructure segment.

The July 23 earnings report will test whether the underlying momentum can sustain the multiple expansion. A second-quarter miss – especially in the optical or cloud segments – could trigger a sharp correction given the stock’s current elevation. Conversely, a beat that shows margins improving alongside revenue would give the bulls fresh ammunition. Either way, the story has moved beyond the nostalgic handset brand that most investors still associate with Nokia. The question now is whether the new identity can deliver the numbers the market is already pricing in.