Nokia Appoints AI-Focused Mobile Chief as Stock Rally Faces Valuation Reality Check

Nokia appoints Emma Falck as President of Mobile Infrastructure, capitalizing on AI boom with stock up 115% and €1B in AI orders.

Nokia’s decision to install a physicist with a background in smart infrastructure to lead its core mobile business signals just how radically the Finnish network equipment maker is reshaping itself for the artificial intelligence era. Emma Falck, currently at Siemens where she managed global teams in intelligent building technology, will take over as President of Mobile Infrastructure on September 1, 2026. She reports directly to CEO Justin Hotard and replaces Tommi Uitto, who left amid reported strategic differences.

The appointment comes as Nokia’s stock has more than doubled this year on bets that the company will be a key beneficiary of the AI infrastructure boom. Shares have surged 115.79% since the start of 2025, though profit-taking on Friday sent them back to €12.02, a decline of 3.69%. That pullback followed another drop earlier in the week, when the stock fell roughly 5% to €11.81, underscoring investor jitters after such an extraordinary run.

What lit the fuse for the rally was a bold outlook from Cisco, which reported $5.3 billion in AI infrastructure orders from hyperscalers in its current fiscal year and lifted its annual forecast from $5 billion to $9 billion. The news rippled through the networking space, drawing buyers into Nokia. The logic is straightforward: AI data centers don’t just need chips—they require fiber optics, switches, optical systems, and robust connections between servers, clouds, and facilities. Nokia sits squarely in that supply chain.

The company has reinforced the narrative with its own product moves. It is rolling out agentic AI tools for network management, designed to automatically optimize networks, handle voice commands, and run multi-step diagnostics that can fix problems without dispatching a technician. The platform will be available for both internet service providers and home networks, and crucially, operators can keep control of their data while integrating external large language models. That flexibility gives it an edge over closed systems from single vendors.

Operationally, the story is gaining substance. In the first quarter, Nokia reported net sales of €4.5 billion, with comparable revenue up 4%. The AI and cloud segment, which now accounts for 8% of group revenue, grew 49% and booked over €1 billion in AI-related orders in a single quarter. Management is targeting 12% to 14% growth in network infrastructure and has raised its annual growth forecast for AI and cloud to 27% through 2028.

At the same time, Nokia is streamlining its portfolio. It is selling its fixed wireless access business to Inseego to focus entirely on AI infrastructure. The recent Infinera acquisition has already improved profitability: comparable gross margin reached 45.5% in the first quarter, and net liquidity stood at €3.8 billion. Shareholders are paid an annual dividend of €0.14.

The big question mark is valuation. With a price-to-earnings ratio of 91, the stock already prices in a great deal of future AI dynamism. As long as hyperscalers keep spending, the re-rating may be justified. But if demand cools or budgets shift to rivals, defending this level becomes far harder.

Analysts, however, are warming to the story. JPMorgan raised its price target from €6.90 to €12.00, while Argus upgraded the stock to Buy after the first-quarter results, citing robust AI demand and upgraded growth forecasts.

Until Falck officially takes the helm, Nokia will run its most revenue-generating division on an interim basis. During this period, critical 5G contract renewals are being negotiated and the architectural foundation for future 6G networks is being laid. The market will get its next update on July 23, when the company reports second-quarter and half-year results. In the meantime, all eyes are on hyperscaler spending, the NVIDIA partnership on AI-enabled radio access networks, and lead times in the optical business, which currently stretch between twelve and eighteen months.