Nokia Lifts the Lid on AI-Era Upload Demand as Moody's Upgrades the Credit
Published on 11/05/2026 at 14:11 | Editorial boerse-global.de
Moody's handed Nokia a vote of confidence on Tuesday, raising the company's long-term issuer rating and its senior unsecured debt rating from Ba1 to Baa3 while keeping a positive outlook in place. The agency pointed to demand for cloud and AI infrastructure as the rationale. The upgrade landed alongside a pair of announcements that sketch out where Nokia believes its next leg of growth will come from — and one that carries a good deal less certainty.
A traffic forecast that turns the spotlight on the uplink
Nokia's Global Network Traffic Report, published yesterday, projects that AI will account for 44% of worldwide network traffic by 2035, with total monthly volume reaching just under 3,789 exabytes. The headline number is only part of the story. Nokia breaks AI applications into distinct categories with very different transmission profiles, and it is physical AI that stands out: the company expects a heavy share of outbound data there, shifting attention from content downloads toward traffic moving in the opposite direction.
Traffic generated by autonomous AI agents is forecast to climb to 160 times its starting level by the end of the forecast horizon, while physical AI is seen at 105 times. More than 90% of that traffic is expected to travel upstream.
Those figures describe a scenario built on defined categories rather than a measurement of traffic already on the wire — a distinction that matters when weighing the commercial opportunity. Rising capacity needs only translate into business if customers act on them with concrete investment decisions.
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Hotwire deal gives the thesis a real-world anchor
A tangible reference point arrived in the form of Hotwire Communications' decision to select Nokia for an AI-ready network in North Carolina. The architecture pairs IP routing with optical functions, cutting down on the number of separate network elements required. Deployment is expected in early 2027, built on Nokia's 7750 Service Router.
Consolidating the layers is intended to reduce network complexity and latency while lowering power and cooling requirements — goals rather than proven operating results. The contract demonstrates a concrete application for Nokia's technology, though it does not yet support a firm conclusion about the financial contribution.
An exploratory data-center angle
Separately, Nokia and Semidynamics signed a memorandum of understanding on 29 October. The two companies will examine whether Semidynamics' AI accelerators and liquid-cooled racks can be combined with Nokia's Data Center Fabric solutions. The agreement covers evaluation, testing and a possible integration, and is explicitly exploratory in nature; no order has been announced.
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Execution, not the scenario, is the yardstick
For investors, the question is whether Nokia can convert expected demand into revenue and profit. The company has already reported long-term contracts in optical and IP networks, while supply bottlenecks and restructuring remain key issues in delivery. Its guidance for 2026 — comparable operating profit of EUR 2.1–2.6 billion — offers a nearer-term financial benchmark than the long-range traffic scenario.
The AI forecast explains where customer investment needs may come from; the Hotwire win shows one place where that is starting to happen. What ultimately matters for the stock is whether Nokia turns it into economically viable growth and hits its earnings targets. The shares slipped 2.4% yesterday to close at EUR 7.41.
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