Nokia's Pre-Earnings Bounce Masks a Steep Slide as Q2 Test Looms

Nokia shares rebound 3.76% but still 40% below 52-week high after Ericsson warns on AI infrastructure pressure; Q2 earnings due July 23.

Nokia shares recouped some ground on Tuesday, rising 3.76 percent to €9.22, but that relief rally does little to obscure the losses sustained over the previous weeks. The Finnish network equipment maker has fallen 40.61 percent since hitting a 52-week high of €14.97 on June 3, with seven consecutive trading days through Monday accounting for a 13.40 percent slide. The stock closed that day at €8.89 — a far cry from the €11 level it briefly touched earlier in the month — and now trades roughly a quarter below its 50-day moving average of €11.90.

A major trigger for the sell-off came from Swedish rival Ericsson, whose second-quarter revenue slipped 6 percent to 52.7 billion Swedish kronor. Although its operating profit of 6.52 billion kronor beat expectations of 6.42 billion, the blow came from a comment that Ericsson’s CFO relayed to Reuters: the entire AI-infrastructure buildout is pressuring the industry — "including us." That admission has rattled Nokia investors who bet that the AI narrative would compensate for persistent weakness in the legacy telecom business. Nokia has underperformed Ericsson by 5.2 percentage points and the Finnish OMXH25 index by 18.7 points over recent weeks.

All eyes now turn to Thursday, July 23, when Nokia reports its second-quarter and first-half 2026 results. Analyst consensus varies by currency: one survey targets revenue of €4.83 billion, a roughly 7 percent sequential uptick, while another projects $5.59 billion. The comparable gross margin is seen at 44.6 percent, and the non-IFRS net profit is forecast at €323 million — a 37 percent year-on-year jump. On a per-share basis, the consensus stands at $0.07. The company has set its analyst webcast for 3 p.m. Finnish time.

The growth story hinges on segments that have been firing: AI & Cloud expanded 49 percent and generated orders worth around €1 billion, while optical networks grew roughly 20 percent. Nokia has already raised its network-infrastructure growth target from 6 to 8 percent to 12 to 14 percent, and CEO Justin Hotard has signaled that the comparable operating profit should land above the midpoint of the company’s €2.0 billion to €2.5 billion guidance. Yet the expected Q2 profit represents about 16 percent of the full-year forecast, at the upper end of Nokia’s historical 12-to-16 percent band. Any miss would ratchet up pressure on the second half to deliver.

Technically, the stock has been deeply oversold: the 14-day relative strength index stood at 31.4 on Monday, climbing to 35.6 by Tuesday, while 30-day annualized volatility remains elevated at 66.72 percent. The €49.42 billion market cap makes Nokia one of Europe’s larger tech names, but the valuation now faces its most direct test. Investors will scrutinize margins, cost control, and whether AI-driven growth from optical and cloud segments can convincingly offset the cyclical drag in traditional telecom. With expectations already baked in for a strong quarter, any deviation from the script could trigger an outsized move.