Nokia’s Pre-Earnings Slide Deepens as Investors Brace for AI Growth Verdict
Published on 07/22/2026 at 21:20 | Redaktion boerse-global.de
The tension surrounding Nokia’s second-quarter results is palpable, and the market is already voting with its feet. Shares in the Finnish telecom equipment maker tumbled for a second consecutive session on Wednesday, with the Helsinki-listed stock sliding 3.44 percent to €9.09. That extends a brutal 28.23 percent monthly decline and leaves the stock trading 39.28 percent below its 52-week high of €14.97, reached on June 3.
The sell-off comes a day before Nokia is due to publish its half-year report and Q2 numbers on Thursday, July 23. Investors are positioning cautiously, weighing whether the company’s surging AI-related revenue can compensate for persistent weakness in its traditional hardware business. The stock’s 14-day relative strength index has fallen to 35.7, edging into oversold territory and suggesting the selling pressure may be nearing exhaustion — though chartists warn that a technical bounce alone won’t reignite the rally without fundamental support from the numbers.
The AI Engine Faces Its First Real Test
All eyes will be on the composition of Nokia’s revenue. In the first quarter of 2026, sales to AI and cloud customers jumped 49 percent, prompting management to sharply raise its full-year guidance for the network infrastructure division from 6-8 percent growth to 12-14 percent. That upgrade fueled hopes that the AI boom could more than offset the downturn in traditional telecom spending.
For Q2, the consensus calls for revenue of €4.822 billion, a 6.1 percent increase, with comparable operating profit rising 24.9 percent to €376 million and a margin of 7.8 percent. On a GAAP basis, analysts expect earnings per share of €0.04. The quarterly result would land near the upper end of the historical seasonal range, where Q2 typically accounts for 12-16 percent of full-year profit. Nokia CEO Justin Hotard has signaled the company is tracking above the midpoint of its full-year operating profit guidance of €2.0-2.5 billion.
Should investors sell immediately? Or is it worth buying Nokia?
The market is pricing the stock at 28 times expected 2026 earnings — a valuation that leaves little room for disappointment. That becomes especially relevant given that rival Ericsson recently flagged rising costs in its AI operations, putting Nokia’s own expense structure under the microscope.
Strategic Moves: Nvidia, Taiwan, and the Shift to Software
Beyond the headline numbers, Nokia has been laying groundwork for its long-term transformation. On July 15, the company unveiled what it calls the industry’s first commercial AI-native radio access network platform, developed in partnership with Nvidia. The AI-RAN platform combines Nokia’s anyRAN software with Nvidia’s Aerial computing technology and is expected to more than double spectral efficiency by 2028 without requiring operators to replace their hardware entirely.
A day earlier, Nokia signed a 5G expansion agreement with Taiwan Mobile, supplying its AirScale portfolio alongside AI-powered software. Both deals underscore the company’s strategic pivot away from pure hardware sales toward software subscriptions with higher, more predictable margins. Nokia is also pursuing growth in optical networking for data centers, a segment that is gaining momentum as global AI infrastructure expands.
A Tale of Two Markets
The divergence between Nokia’s two listings is striking. While the Helsinki shares have been under pressure, the New York-listed American depositary receipts rallied sharply on Tuesday and continued to gain in after-hours trading. JPMorgan added to the optimism by raising its price target on the US listing to $21 from $14, maintaining an “Overweight” rating — a clear signal that at least one major analyst house is betting on a positive earnings surprise.
Nokia at a turning point? This analysis reveals what investors need to know now.
On the shareholder front, FMR LLC, the parent of Fidelity, reduced its stake below the 5 percent reporting threshold, a move that may have added to the selling pressure in Europe.
The Moment of Truth
With annualized volatility running at nearly 67 percent, the market is bracing for a binary outcome. If Nokia confirms the upgraded 12-14 percent growth range for its network division and demonstrates that AI revenue momentum remains intact, the stock could find near-term relief. But if the pace of AI growth decelerates from the first quarter’s 49 percent clip, the downward trend may well accelerate. Thursday’s report will determine whether Nokia’s AI narrative has the substance to support its valuation — or whether the pre-earnings jitters were justified.
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Nokia Stock: New Analysis - 22 July
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