Nokia Oyj (HEL:NOKIA) experienced a sharp weekly decline of 18.8%, closing at €8.852 on Friday. The stock fell in each trading session, with the OMX Helsinki 25 remaining nearly flat, highlighting the company's divergence from the broader market.
The decline closely mirrored that of U.S. peer Ciena Corp (NYSE:CIEN), which dropped 18.7% over the same period. This near-perfect correlation suggests investors are increasingly treating Nokia as a proxy for AI-driven networking demand, rather than a traditional Finnish defensive stock.
Ericsson (STO:ERIC-B) also fell 13.6% after reporting second-quarter sales below expectations, though adjusted operating profit slightly exceeded forecasts. CFO Lars Sandström noted that the AI build-out is pressuring the entire industry, citing rising memory prices and custom-chip costs as key headwinds.
Nokia's AI outlook presents a dual narrative. While increased data-center activity could boost optical sales, the same trend may compress hardware margins. The Philadelphia Semiconductor Index's 20% drop from its June peak into bear market territory on Friday reinforced these concerns.
In the first quarter, Nokia posted a 49% surge in AI and cloud sales, securing €1 billion in new orders. The company raised its 2026 sales growth outlook for Network Infrastructure to 12%-14% in April, while maintaining its comparable operating profit forecast of €2.0 billion to €2.5 billion.
This Thursday, July 23, Nokia is expected to report order growth but avoid pressure on gross margins. Markets will also seek clarity on component expenses. The AI-RAN rollout announced this week does not affect the near-term schedule, with trials beginning later this year and commercial launch targeted for 2027.
Omdia analyst Rémy Pascal described the AI-RAN launch as a significant step toward commercial reality, but noted that revenue impact remains a future story. Nokia will release its results around 08:00 EEST on Thursday, with an analyst webcast at 15:00 EEST.
Risks remain balanced. A surge in AI orders or successful pricing could trigger a swift recovery, while lower intake or new cost increases may prolong the downturn.
