HELSINKI – Nokia Oyj (HEL:NOKIA) shares continued their downward trajectory on Friday, sliding to €11.740 in Helsinki trading, as the recent AI-driven rally fades and investors grow cautious ahead of the company's second-quarter earnings report. The decline has wiped out approximately €18 billion in market capitalization since the stock hit its June 3 peak of €14.995.
The stock closed at €12.185 on Thursday, marking a drop of about 3.7% in the latest session. The OMX Helsinki 25 index fell 1.14% on the day, underscoring broader market weakness. Nokia's current market cap stands at roughly €66.04 billion, down from an estimated €84 billion at the June high—a difference of about €18 billion, which is roughly eight times the midpoint of Nokia's 2026 operating profit target of €2.0–2.5 billion.
Despite a flurry of AI-networking partnership announcements, including deals with Amazon Web Services (AWS) and Databricks, as well as a defense contract with the Finnish Border Guard, the stock has been unable to sustain its earlier momentum. Investors appear to be waiting for concrete financial details, such as contract values, backlog conversion rates, and margin trends, before reassessing the stock's valuation.
Nokia's AI and cloud sales surged 49% in the first quarter, now representing 8% of total revenue. CEO Justin Hotard noted that demand had "accelerated significantly," prompting the company to raise its AI and cloud addressable market growth forecast to a 27% compound annual growth rate (CAGR) for 2025–2028, up from 16% previously. However, the market seems to be pricing in these optimistic projections, and further upside may require tangible proof of execution.
On June 24, Nokia announced an expanded collaboration with AWS to develop autonomous network solutions. The company's Autonomous Network Fabric is expected to be available on AWS later this year. "Autonomous networks have gone from far-off vision to business imperative," said Oguz Sunay, Nokia's CTO for AI and Autonomous Networks. The same day, Nokia and Databricks completed a proof of concept for a unified data platform designed for autonomous networks, which Sunay described as "a big step" toward the necessary data backbone.
In the defense sector, Nokia's Defense unit joined a Finnish-Nordic consortium led by the Finnish Border Guard to develop counter-drone technology for patrol vehicles and boats. Mikko Hautala, chairman of Nokia Defense and the company's chief geopolitical and government relations officer, emphasized that "secure connectivity is essential for defense players with fast-moving threats."
Nokia's American Depositary Receipts (NYSE:NOK) showed a slight uptick on Thursday, rising 1.23% to close at $13.98, marking a second consecutive day of gains. However, trading volume was relatively light at 75.7 million shares, well below the 50-day average of 118.2 million, according to MarketWatch data.
Looking ahead, Nokia is scheduled to report its Q2 and half-year 2026 results on July 23. The company entered a closed trading window from June 23 to July 23, during which insiders are barred from trading. The upcoming earnings release will be closely watched for signs of whether the AI networking boom is translating into sustained revenue growth and profitability.
