Shares of Nokia Oyj jumped 10.06% to €12.97 in Helsinki on Friday, making it the top gainer on the OMX Helsinki 25 index, which closed up 1.53%. The rally was fueled by a bullish analyst call from JPMorgan, which raised its price target on the Finnish telecom equipment maker to €18 from €12 and maintained an overweight rating. The move underscores growing optimism around Nokia's pivot toward artificial intelligence and cloud networking.
The U.S.-listed Nokia American depositary receipts (ADRs) also extended gains, rising about 5% to $14.80, following a 5.15% advance on Thursday that snapped a two-day losing streak. The ADRs remain below their 52-week high of $17.45 set on June 3, but the recent uptick signals renewed investor interest. ADRs allow U.S. investors to trade foreign stocks like Nokia.
Analyst Outlook
JPMorgan's upgrade was driven by expectations that Nokia's 2028 operating profit could exceed the company's own target by more than 50%. The bank argued that consensus estimates may be underestimating the potential from AI and cloud sales. According to a report from MarketScreener citing Finwire and Bloomberg News, JPMorgan now sees Nokia shares outperforming their benchmark, supported by the company's expanding footprint in optical networks, IP routing, and cloud infrastructure for AI data centers.
In the first quarter of 2026, Nokia posted a 54% jump in comparable operating profit to €281 million, with sales to AI and cloud clients surging 49%. The company reported €1 billion in AI and cloud orders for the quarter. CEO Justin Hotard stated, "We are increasing our growth assumption for Optical and IP Networks," and Nokia raised its 2026 sales growth target for Network Infrastructure to 12%–14%.
AI Strategy and Product Launch
Nokia is deepening its commitment to AI, albeit with a longer-term horizon. On June 11, the company unveiled an agentic AI framework for its Network Services Platform, designed to enable operators to deploy AI agents for managing IP networks within defined rules and security boundaries. "Trust remains the deciding factor," said Sasa Nijemcevic, vice president and general manager for IP Network Automation software. The new technology is expected to be ready for commercial sale by the end of 2026.
Bearish Concerns
Despite the bullish narrative, some analysts caution that the stock has run too far. EFN Research flagged that the market may have gotten ahead of itself with AI-driven names like Nokia. The stock has nearly tripled over the past year, even though 2025 revenue grew only 3%. Gains in cloud and AI were partially offset by weakness in fixed networks. On MarketScreener's consensus page, 23 analysts rate Nokia an average "outperform," but the mean price target is €10.24, well below the latest close of €12.96. The highest target is €18, matching JPMorgan's estimate.
Upcoming Catalysts
The next major test for Nokia shares will be the release of its second-quarter and half-year 2026 results on July 23. Investors will closely monitor whether AI and cloud orders are translating into revenue and whether IP and optical networks remain on track to meet Nokia's 18%–20% growth target. Margins are also in focus as the company ramps up spending on manufacturing capacity and research. Nokia's first-quarter guidance projects Q2 net sales to increase 5%–9% sequentially, with comparable operating profit accounting for 12%–16% of the full-year figure.
For valuation-focused investors, Nokia remains a challenging buy given its elevated price relative to consensus targets. However, the JPMorgan upgrade provides a strong bullish counterpoint, betting that high-speed AI earnings will justify the premium. Key risks include competition, shifting customer spending, supply chain disruptions, currency fluctuations, and broader volatility in AI-related stocks.
