Nokia's Beat: What Was Priced In and What's Next?

The core expectation gap here was narrow. Nokia delivered a clean beat on both lines, but the market had already priced in a solid quarter. The company reported , , , . This was a beat, but not a blowout. The stock's reaction was telling: it gapped up on the upgrade from Kepler Capital Markets, which moved it from Hold to Buy, and has since traded near . This move reflects the "buy the rumor, sell the news" dynamic in action. The upgrade provided the catalyst, but the actual print was largely in line with what was already anticipated.

The setup leaves the stock vulnerable. The consensus rating is a "Moderate Buy" . That target sits below the current trading level, suggesting the market's forward view is already optimistic.

The real test now shifts to guidance. The company's new long-term target for comparable operating profit-EUR 2.7-3.2 billion by 2028-is the key metric for the next leg of the story. For the stock to sustain its move, Nokia will need to show it can not only meet but exceed these ambitious, forward-looking benchmarks. The recent beat was the minimum required to clear the near-term hurdle.

The Guidance Reset and Analyst Divergence

The recent beat has triggered a volatile reset in analyst sentiment, revealing a wide gap in expectations. On one side, firms like and Danske have upgraded Nokia to Buy, citing the solid quarterly print as validation of the turnaround story. On the other, and UBS have downgraded or maintained neutral ratings, suggesting they see the improvement as already priced in or insufficient to justify a higher stance. This split creates a volatile rating environment where the stock's path hinges on which view gains traction.

The divergence is most stark in price targets. The consensus average sits around , but that figure masks a significant range. & Co. stands out with a bullish target, a view that implies the market's forward-looking benchmarks are too conservative. This gap highlights the core uncertainty: is the stock being valued on its recent operational beat, or on its ability to execute the new long-term strategy? The wide dispersion suggests professionals are struggling to agree on the trajectory.

Viewed against the stock's technical levels, the upside potential if the bullish case wins out is clear. Nokia trades near , well below its . . For the stock to reclaim that territory, the company must not only meet but consistently exceed the ambitious comparable operating profit targets it has set for 2028. The recent upgrade cycle provides a near-term catalyst, but the real test is whether the guidance can bridge the expectation gap that the current consensus price target implies.

Catalysts and Risks: The AI Supercycle Play

The forward path for Nokia hinges on executing its new strategy to capture the AI supercycle, a clear catalyst that could close the expectation gap. The company is repositioning itself as a leader in the AI-driven transformation of networks, with a new operating model split into Network Infrastructure and Mobile Infrastructure segments. This shift, effective January 1, 2026, is designed to accelerate innovation and serve customers better in a market where demand for advanced connectivity is surging. The key metric to watch for traction is sequential growth in network infrastructure. Evidence of this momentum is already visible, with the company reporting in that segment. Sustained expansion here would signal strong customer booking momentum and validate the strategic pivot.

Yet, the path is fraught with a major, well-known risk: exposure to carrier capex volatility. The company's financial outlook remains precarious because its revenue can swing significantly from quarter to quarter based on the spending cycles of telecom operators. This inherent instability can pressure profitability and make it harder to consistently meet the ambitious comparable operating profit targets set for 2028. Bears highlight this as a core challenge, noting that Nokia's ability to profitably compete in the 5G market is at risk from these external swings.

The bottom line is a high-stakes bet on execution. The AI supercycle provides a powerful growth narrative and a clear strategic direction, which bulls see as a catalyst for the stock to reclaim its 52-week high. But the risk of capex volatility means the company must not only grow but do so with predictable, profitable execution. The recent analyst divergence-ranging from a target to a more cautious consensus-reflects this tension. For the stock to move decisively higher, Nokia must demonstrate that its new strategy can insulate it from the worst of the volatility while consistently driving the sequential growth that proves the AI thesis is real.