Nokia’s transformation from a telecom equipment stalwart into a player with two fast-growing engines bore fruit on Thursday, sending its shares up 7.59% to €11.20. The jump — the stock’s sharpest single-day move in weeks — came as the Finnish company landed a roughly €1 billion order for optical network gear tied to AI and cloud computing, and unveiled three new defense technologies built around 5G and artificial intelligence.
The market cap now stands at €61.58 billion, and the stock has more than doubled over the past 12 months. Yet at €11.20 it remains 25.22% below its 52-week high of €14.97 reached in June, a reminder that the recent rally has not fully recouped the steep slide from that peak.
AI Orders and an Analyst’s Upgrade
The €1 billion in optical network contracts — reportedly for AI and cloud applications — gave investors the clearest sign yet that Nokia’s networking unit can win large-scale deals in the data-center boom. JPMorgan responded by raising its price target sharply from $14 to $21, a move that added further momentum to the day’s climb.
To support that pipeline, Nokia is scaling up U.S. manufacturing. A second factory for indium-phosphide semiconductors is coming online in San Jose, California, complementing the expansion of a photonics site in Allentown, Pennsylvania. Those investments form part of a broader, $4 billion U.S. capital offensive.
Defense Tech: From Pilot to Product
The defense announcements mark a concrete step after Nokia and the Finnish state fund Tesi jointly invested €100 million in local AI lab NestAI back in November 2025. That capital is now yielding three systems: an AI-powered command-and-control platform running over mobile 5G, a mission-planning tool with secured connectivity, and a sensor-fusion early-warning system for threat detection. All three are designed to NATO standards and function in so-called “denied environments” where adversaries deploy jammers or drone swarms.
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Nokia Defense and NestAI together built the underlying NestOS software, which integrates the AI layer with Nokia’s 5G infrastructure to create private communication networks that remain operational even when public networks are knocked out. Mikko Hautala, chairman of Nokia Defense, and NestAI founder Peter Sarlin both underscored the solution’s European sovereignty — a selling point as EU and NATO members race to upgrade their communications resilience.
The pivot into defense is a deliberate counterweight to Nokia’s core telecom equipment business, which faces pressure from falling 5G spending in North America. By targeting military and government clients, Nokia is hunting for higher-margin revenue streams that are less tied to carrier capital-expenditure cycles.
Insiders Get a Tranche
On the corporate governance front, Nokia disclosed an internal share transfer under the EU Market Abuse Regulation. The company moved 43,552,813 treasury shares — at no consideration — to participants in its equity incentive programs. After the transfer, 88,583,624 shares remain in treasury. Among the beneficiaries, manager Raghav Sahgal received 384,402 shares and David Heard received 184,900 shares.
Technical Picture and What’s Next
Despite Thursday’s surge, the stock’s recent volatility remains elevated. The 30-day annualized volatility is 76.63%, and the relative strength index of 46.5 suggests the rally has not yet pushed the stock into overbought territory. The shares trade 48.43% above their 200-day moving average of €7.54, a metric that speaks to the longer-term uptrend.
Investors will get a fuller picture of how the AI and defense strategies are translating into financial results on July 23, when Nokia reports second-quarter earnings. Analysts will be watching closely for the revenue contribution from the new optical contracts, as well as progress on the partnership with Nvidia, which has held a 2.9% stake in Nokia since early this year.
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