Nokia Stock Has More Than Doubled. Here’s What’s Fueling The Rally

Key Points:

• Nokia's stock has surged approximately 140% year-to-date in 2026, driven largely by a strategic partnership with Nvidia, which invested $1 billion in the company in October 2025 to develop AI-RAN technology integrating AI workloads with wireless network infrastructure.
• The company's Q1 2026 earnings exceeded expectations, with revenue increasing 4% year-over-year to 4.5 billion euros, operating profit rising 54% to 281 million euros, and EPS beating estimates by 31%, fueled by a 49% surge in sales to AI and cloud customers.
• Nokia's Optical Networks segment grew 20% in Q1 due to heightened demand from hyperscalers building AI data centers, prompting the company to raise its growth and operating profit guidance for the year.
• To meet increasing demand, Nokia is expanding its optical manufacturing capacity with a capex increase to as much as 1 billion euros and recently opened an AI Networking Innovation Lab in California, collaborating with major tech partners and securing 10 public customers for its AI-RAN platform.
• Despite risks related to AI spending volatility and cautious telecom operators, Nokia has repositioned itself from a traditional telecom hardware provider to a key player in AI, optical networking, and next-generation wireless technologies, marking a significant transformation since its founding in 1865.