Nokia’s 30% Retreat Masks a Growing Consensus That the AI Pivot Is Working
Published on 07/09/2026 at 05:42 | Redaktion boerse-global.de
Nokia’s stock has tumbled roughly 30% from its mid-2024 high, yet analysts keep raising their price targets and the Finnish telecom equipment maker is quietly stacking up partnerships that bolster its shift toward artificial-intelligence infrastructure. The disconnect creates one of the more intriguing narratives in European tech right now: a share price in retreat that few on the sell side seem willing to abandon.
Shares closed Wednesday at €10.40, a level that marks a 30.49% slide from the June 3 intraday high of €14.97. Over the trailing 30 days the stock lost 13.33%, and the weekly decline stood at 1.61%. The sell-off has been broad enough to make Nokia’s US-traded American depositary receipts among the weakest European ADRs, even on days when the broader market rallied — July 2 being a notable example when Nokia and French pharmaceutical group EDAP were the only decliners among continental European ADRs despite a strong equity session.
Operational wins continue, but the market is looking elsewhere
Beneath the price action, business momentum remains intact. On Wednesday, Philippine operator Smart Communications confirmed the successful completion of technology trials using Nokia’s roaming solutions, focusing on automated roaming management and efficient network handovers — both considered critical for the next phase of 5G-Advanced and AI-driven connectivity. The test follows a string of contract wins, most notably the exclusive multi-year modernization agreement with Orange Belgium announced in early July, under which Nokia will supply a unified optical transport network based on its 1830-PSS platform and WaveSuite automation software.
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Institutional investors are taking notice. Slate Path Capital, a fund run by David Greenspan, increased its Nokia stake by 7% in the first quarter, and the stock now accounts for about 4.3% of the fund’s portfolio. Nokia is simultaneously pushing its own digital transformation: in late June it confirmed a multi-year agreement with SAP and Microsoft to migrate its enterprise resource planning systems to SAP S/4HANA running on Microsoft Azure, embedding AI capabilities into internal processes as well as the products it sells to carriers.
Analyst upgrades pile up even as the chart softens
The contrast between falling prices and rising analyst conviction is stark. Danske Bank upgraded Nokia from “Hold” to “Buy” on July 1, setting a €14 price target just as the stock began its steepest descent. Shortly afterward, another house lifted its target to €15.60, citing the company’s improving positioning in AI and cloud infrastructure, and reiterated its buy recommendation.
The optimists’ case rests heavily on Nokia’s deepening ties with hyperscalers. The company is expanding its partnership with Google Cloud to integrate Gemini-based AI agents into its Assurance Center, with a SaaS launch via the Google Cloud Marketplace slated for September. Separately, Nokia’s Autonomous Networks Fabric is on track to become available on Amazon Web Services later this year, targeting Level 4 autonomous network capabilities.
Fundamentally, the picture is mixed. Nokia generated roughly $19.22 billion in revenue, giving it a price-to-sales ratio of 1.56 — moderate for a large-cap equipment maker. The trailing price-to-earnings multiple of 46.1, however, looks stretched for a business growing at telecom-industry pace. The balance sheet provides a cushion: total assets of about $37.6 billion against equity of $21 billion, enough firepower to weather a cyclical downturn in carrier spending.
Technical indicators flash caution but the long-term trend holds
The recent slide has pushed Nokia’s 14-day relative strength index to 38.4, moving toward the oversold threshold of 30. The 30-day annualized volatility has jumped to 73.13%, reflecting the turbulent trading sessions of recent weeks. The stock closed below its 50-day moving average of €12.08 but remains above both the 100-day average of €9.74 and the 200-day average of €7.51 — meaning the long-term uptrend, which has delivered a 137.56% gain over 12 months and an 86.87% advance year-to-date, is still technically intact even if short-term momentum has evaporated.
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Earnings in two weeks will test the narrative
All eyes now turn to Nokia’s second-quarter results, due July 23. Analysts expect concrete evidence of how strongly the “AI super-cycle” — a phrase management has used heavily — is translating into revenue and margin improvement. The Zacks consensus projects 2026 revenue growth of 6.18% year-over-year and earnings-per-share expansion of more than 21%. In the first quarter, revenue with AI and cloud exposure surged 49%, raising the bar for whether Nokia can sustain that pace.
The immediate tension is between near-term headwinds in telecom equipment spending and a longer-term thesis built on AI radio access networks, optical networking, and cloud partnerships. The stock may have lost a third of its value since June, but the accumulation of contracts, analyst upgrades, and hyperscaler collaborations suggests the market is pricing in skepticism that the earnings report could either confirm or erase.
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