Nokia Shares Caught Between Chip Sector Chill and Nvidia-Powered AI Boom as Q2 Earnings Near
Published on 07/06/2026 at 20:03 | Redaktion boerse-global.de
A wave of profit-taking sweeping through the global chip and artificial-intelligence trade has knocked Nokia off its recent highs, dragging the stock 1.34% lower on Monday to €11.03. The pullback leaves the Finnish telecom-equipment maker roughly 26% below its June 3 record of €14.97, a decline that has little to do with the company’s own operations and everything to do with a broader rotation out of technology stocks. The Philadelphia Semiconductor Index slumped 12% in just two trading sessions as reports of production delays on next-generation server architectures rippled through the supply chain, and Morgan Stanley analysts see capital rotating into other sectors. Over the past seven days, Nokia has shed 2.99%, with the 30-day loss widening to 11.65%. The stock now trades 8.46% below its 50-day moving average of €12.05, a technical signal that the short-term uptrend has stalled.
Yet beneath the surface volatility, Nokia’s fundamentals and strategic repositioning tell a markedly different story. The company has successfully pivoted into two high-growth arenas — defence technology and artificial-intelligence infrastructure — a transformation that has lured a $1bn investment from Nvidia in late October 2025. The chip giant’s bet is aimed at co-developing next-generation radio networks optimised for AI workloads, a partnership that has already begun to flow through to Nokia’s order book. In the first quarter, the AI and cloud segment posted a 49% year-on-year revenue jump, generating new orders worth more than €1bn. The optical-networks division also benefited from surging demand out of large data centres, expanding by a fifth. Combined, these tailwinds helped lift first-quarter operating profit by 54% to €281m, with gross margins reaching 45.5%.
Nokia’s defence ambitions have added another layer of momentum. At the weekend, the company participated in a NATO armaments forum, and its 5G technology is being tested by Ukrainian forces for secure battlefield communications. Market participants are watching for concrete procurement contracts, potentially announced at the upcoming NATO summit, which could provide a further catalyst. The push into sovereign infrastructure is designed to reduce Nokia’s reliance on the cyclical mobile-network business and open a recurring revenue stream.
Should investors sell immediately? Or is it worth buying Nokia?
The disconnect between the recent share-price dip and the underlying business strength is highlighted by the order pipeline. Nokia’s book-to-bill ratio stands at roughly 3x, meaning it books three euros in new orders for every euro of revenue — a level that suggests robust demand even as the broader tech sector faces valuation pressure. The relative strength index has slipped to 42.7, approaching oversold territory, while the stock’s 46.06% premium above its 200-day moving average remains unusually wide, underscoring just how far the rally has come before this correction.
Management has set a full-year 2026 operating profit target of up to €2.5bn, a goal that will be tested when Nokia reports second-quarter results on July 23. The upcoming earnings release will need to demonstrate that the margin expansion can be sustained and that the Nvidia-linked order momentum has not faded amid the chip-sector slowdown. With annualised volatility at 71.84%, the stock is no stranger to sharp swings, and the Q2 report is unlikely to calm the fluctuations. The market will be watching closely to see whether the fundamental strength that powered a 98.10% year-to-date gain and a 151.14% twelve-month surge can outweigh the sector-wide headwinds that have recently clipped the stock’s wings.
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Nokia Stock: New Analysis - 6 July
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