Nokia (NOK) Rallies 1.97% on 5G Automation Pact, AI Infrastructure Expansion, Infinera Acquisition

Nokia’s share price (NOK) rose 1.97% on Tuesday, marking an eight-day winning streak with a cumulative gain of 10.94%. The stock hit an intraday high of $5.42, its highest level since October 2025, driven by strategic business developments and renewed investor optimism.

Recent momentum has been fueled by a multi-year 5G automation partnership with AT&T, enhancing Nokia’s footprint in the U.S. market, a key growth region. The deal aligns with rising demand for AI-ready infrastructure, positioning the company to capitalize on next-generation connectivity trends.

A $2.3 billion acquisition of Infinera, approved by the EU, has bolstered Nokia’s optical networking capabilities, strengthening its competitive edge in high-speed data transmission. This expansion supports growing needs in AI and cloud infrastructure, critical for long-term revenue growth.

Product innovation further underscores Nokia’s strategic focus. The launch of its 50G PON solution, the world’s first quantum-secure broadband technology, addresses enterprise demand for future-proof networks. Additionally, a collaboration with Fibertime in South Africa aims to extend high-speed fiber broadband to 400,000 homes, aligning with global efforts to bridge digital divides.

Leadership changes also signal a strategic shift. Justin Hotard, the new CEO with a background in Intel’s AI and data center divisions, has prioritized investments in AI infrastructure and cloud technologies. Analysts note his expertise could accelerate Nokia’s transition to high-growth sectors, though near-term challenges such as margin pressures remain under scrutiny.

Analyst sentiment is mixed, with a revised consensus price target of €4.49 reflecting optimism about Nokia’s infrastructure focus. However, concerns persist over execution risks, including competition from Ericsson and macroeconomic headwinds. The stock trades at a premium to peers, raising questions about short-term profitability despite long-term AI-driven opportunities.

Geopolitical risks, such as China’s reduced reliance on Western telecom suppliers, pose potential threats to Nokia’s market share in key regions. Meanwhile, competitive pressures from Ericsson highlight the need for differentiated offerings in the resilient telecom equipment sector.

Investors are balancing Nokia’s strategic momentum against near-term financial adjustments, including revised 2025 operating profit guidance. While the company’s focus on AI and 5G infrastructure offers growth potential, ongoing execution risks and market dynamics will likely shape its trajectory in the coming months.