Nokia’s 160% Surge Prompts Options Traders to Play Both Sides as AI Orders Reach €1 Billion

Nokia shares hit 52-week high as options market places massive straddle. AI revenue jumps 49%, Q1 profit beats estimates, analysts upgrade.

The options market has lit up around Nokia as the stock’s relentless rally draws in traders betting on more fireworks — but not necessarily on the direction. On Monday, the Finnish telecom-equipment maker’s shares touched €14.40, a fresh 52-week high, and the derivatives market responded with an unusually symmetrical wager.

Some 100,000 put and 100,000 call contracts were placed on Nokia’s American Depositary Receipts, all with a strike of $15 and expiring in July 2026. This classic straddle signals that participants expect a sharp move but are unwilling to pick a side. The sheer scale — total options volume hit 73.8 million contracts — underscores the heightened sensitivity around a stock that has already surged nearly 159% in six months.

The AI Engine That Rewired the Narrative

Behind the volatility lies a fundamental shift in Nokia’s business profile. In the first quarter of 2026, revenue from AI and cloud customers jumped 49% year on year, contributing roughly €1 billion in new orders. That segment now accounts for 8% of group sales, and management sees the addressable market expanding at an annual pace of 27% between 2025 and 2028 — up sharply from an earlier estimate of 16%.

The surge in AI-related business helped Nokia post net sales of €4.5 billion in Q1, a currency-adjusted increase of 4%. More importantly, comparable operating profit soared 54% to €281 million, comfortably above the consensus forecast of €250 million. The company’s traditional telecom revenue slipped 2% in the quarter, but growth in higher-margin data-center and AI networking more than offset the drag.

Optical Networks delivered a standout 20% sales gain, while the broader Network Infrastructure division rose 6%. CEO Justin Hotard has signaled continued investment to capture rising demand, and the optical-and-IP networks unit saw its growth outlook hiked to 18-20% from 10-12% — a revision that analysts say triggered the stock’s revaluation.

Analyst Stampede and a Squeezed Multiple

The sell-side has scrambled to catch up. Morgan Stanley raised its price target on the Helsinki-listed shares from €11 to €14 and named Nokia a top pick, arguing it is uniquely positioned to ride data-center capital expenditure. CFRA upgraded from “Hold” to “Buy” and doubled its ADR target to $16. JPMorgan moved to “Overweight”, while Deutsche Bank, Argus, Arete, and Nordea also issued upgrades.

Even so, Nokia’s forward price-to-earnings ratio has compressed from roughly 17 to around 36 in a matter of months. The trailing multiple stands at about 37, a touch above the sector average of 35.6. That leaves little room for execution stumbles, which helps explain why the next earnings report on July 23 carries outsized weight.

Institutional Money and a Fresh Leadership Addition

Institutional investors have been piling in. During the first quarter, 341 funds expanded their Nokia holdings while 212 trimmed. FMR LLC increased its stake by 34.6%, and Jane Street Group boosted its position by nearly 920%. The stock’s potential inclusion in the Euro Stoxx 50 index in September could trigger further passive inflows.

Nokia is also strengthening its management bench. Emma Falck will take over as head of Mobile Infrastructure on September 1, 2026. Falck joins from Siemens, where she was Executive Vice President for Smart Infrastructure Buildings. She holds a doctorate in computational physics from Aalto University and previously worked at Boston Consulting Group.

What’s Next on the Calendar

The near-term catalysts are stacking up. Ciena, a direct rival in optical networking, reports early June and could set the tone for the entire sector. Nokia itself guided for Q2 sales growth of 5-9% versus Q1, with operating profit expected to account for 12-16% of the full-year total. Full half-year results land on July 23, when investors will scrutinise whether the AI order momentum is translating into bottom-line gains.

For now, the straddle market is pricing in a binary outcome: either the fundamental story delivers the goods and propels the stock further, or the stretched valuation catches up. Either way, the options crowd is ready for a move.