Nokia’s AI-Driven Transformation Gains Momentum, but the Market Demands Hard Evidence
Published on 07/16/2026 at 08:52 | Redaktion boerse-global.de
Nokia’s share price has taken a sharp turn lower even as the Finnish network equipment maker rolls out its most ambitious strategic pivot in years. The stock closed at €9.85 on Wednesday, shedding 13.1% over the past week and nearly 19% over the last month — a brutal contrast to the triple-digit gains it had posted over the previous twelve months. From its June 3 peak of €14.97, the equity now sits more than 34% lower, a move that has left many investors questioning whether the market is punishing the company or merely taking profits after an extraordinary run.
At the heart of the sell-off lies a paradox: the operational news flow has been overwhelmingly positive. On July 15, Nokia launched what it calls the industry’s first commercial AI-RAN platform, developed in partnership with Nvidia. The software-based architecture replaces in-house chip designs with Nvidia’s standard semiconductor platform and leverages Nokia’s anyRAN software alongside Nvidia’s Aerial AI-RAN technology. The company is targeting a more-than-doubling of spectral efficiency by 2028 — a jump that would let mobile operators extract twice the capacity from their existing spectrum without new hardware. Current measured improvements stand at 20%, with a 50% milestone penciled in for 2027.
The day before that announcement, Nokia signed a major 5G expansion deal with Taiwan Mobile. The Taiwanese operator will deploy Nokia’s AirScale portfolio — base stations, radio gear and AI-powered software — to accelerate its shift toward AI-native mobile networks. The software promises to automate network operations, cut energy consumption and boost capacity for services such as network slicing and RedCap. Financial terms were not disclosed, but the partnership extends a long-standing relationship and lays the groundwork for 5G-Advanced and eventual 6G networks. T-Mobile US has also signed on as a pilot customer, with field trials scheduled for 2026 and commercial deployment expected in 2027.
Should investors sell immediately? Or is it worth buying Nokia?
Underpinning all of this is a fundamental business-model overhaul. Nokia is shifting from selling fixed hardware to a software-subscription model, where network capabilities can be upgraded over time via cloud-based updates. That reduces operators’ capital-expenditure cycles and keeps the equipment relevant deep into the 6G era. But while the strategy is clear to executives, the market has yet to see proof that these partnerships and software deals are translating into revenue and profit growth.
Several forces are weighing on the stock. The broader networking and semiconductor sector has been under pressure — rivals such as Ciena and Arista have also retreated, suggesting a sector-wide rotation rather than a Nokia-specific problem. More importantly, Nokia’s shares had rallied 142.5% over the past twelve months and roughly 77% year-to-date before the current pullback. After such a steep climb, profit-taking was almost inevitable, especially with the stock trading well above its historical price-to-earnings median. The relative strength index now sits at 37.1, flirting with oversold territory, while the annualized 30-day volatility hovers near 73%, leaving room for violent swings in either direction.
The real test arrives on July 23, when Nokia reports its second-quarter and first-half results. Wall Street expects earnings of roughly €0.05 per share on revenue of about €4.83 billion. Investors will be watching closely for signs that the Infinera acquisition and the new AI-RAN subscription software are starting to lift margins. For now, the market is sending a clear message: impressive announcements are fine, but the numbers have to follow.
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Nokia Stock: New Analysis - 16 July
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