Nokia Oyj's first-quarter results have put the Finnish network equipment maker back in the spotlight, as a sharp rise in artificial intelligence and cloud-related orders drove a significant earnings beat. The company's stock is now facing a fresh test as it prepares to trade ex-dividend on Monday, April 27, in both Helsinki and New York.
Strong Q1 Performance
Nokia reported a comparable operating profit of 281 million euros for the first quarter, a 54% increase year-over-year and above the 250 million euro consensus estimate from analysts polled by Infront. Comparable net sales, adjusted for constant currency and portfolio changes, rose 4% from a year earlier. The Network Infrastructure segment led the way with a 6% sales increase, while Optical Networks surged 20%.
The company's AI and cloud customer segment, though still a modest 8% of total group sales, is rapidly gaining momentum. Orders from these clients jumped 49% to 1 billion euros during the quarter, underscoring the growing demand for high-speed optical and IP networking solutions that underpin data center expansion.
Ex-Dividend and Market Reaction
Nokia shares will trade ex-dividend on April 27, with a payout of 0.04 euros per share in Helsinki and a gross dividend of $0.0468 per American Depositary Receipt (ADR) in New York. The company's U.S.-listed ADRs closed at $10.46 on Friday, up 1.2% from the previous session, with approximately 126.6 million shares changing hands. The stock had earlier surged to its highest level since April 2010 in early Helsinki trading following the earnings release, according to Reuters.
AI Infrastructure Race
Chief Executive Justin Hotard emphasized the company's strategic pivot toward AI-driven infrastructure. "We are increasing our growth assumption for Optical and IP Networks and we are investing to capture accelerating demand from AI & Cloud customers," Hotard said in the earnings release. He warned that Europe risks falling behind in the AI buildout without adequate infrastructure, noting that connectivity and data-center muscle are as critical as factories.
Nokia now expects Network Infrastructure net sales to climb 12% to 14% in 2026, with Optical Networks and IP Networks combined projected to grow 18% to 20%. The company maintained its full-year comparable operating profit target of 2.0 billion to 2.5 billion euros, though management indicated performance is tracking slightly above the midpoint.
Competitive Landscape
Nokia's trajectory increasingly pits it against networking specialists like Ciena and Cisco, rather than just traditional telecom rivals such as Ericsson. The shift reflects investors' growing perception of Nokia as an AI-networking play rather than merely a 5G hardware provider. However, the rally is not without risks. Nokia cited competitive pressures, evolving customer spending patterns tied to AI and data-center expansion, higher R&D costs, rising chip expenses, and potential supply-chain disruptions as factors that could alter its outlook.
Outlook
The ex-dividend session on Monday will provide an early signal on whether investor enthusiasm for Nokia's AI narrative persists. While the dividend payout may temper short-term momentum, the underlying strength in AI-driven orders suggests the company is carving out a credible position in the infrastructure race. The challenge will be sustaining the first-quarter surge amid potential headwinds in cloud spending and component availability.