u/Mustathmir
▲ 13 r/Nok
Why non-telecom Emma Falck may actually be a logical choice for Nokia’s MI transformation
Emma Falck, appointed to lead MI, doesn't need to be a RAN guru; she doesn't directly lead Radio Networks, but rather MI, which comprises three business units: Radio Networks (formerly Mobile Networks), Core Software (formerly CNS), and Technology Standards (formerly Nokia Technologies). Each business unit has its own operational leadership that knows their respective fields inside out, which Falck will steer in the direction of the desired transformation.
The appointment is likely a signal that Hotard does not want MI to be just a traditional RAN hardware vendor in the future, but rather a software- and AI-driven infrastructure entity where standards, software, and networks are more tightly integrated than before. A background from Siemens and KONE within intelligent infrastructure and automation systems may be even more relevant for this than a classic telecom background. Going forward, the share of software would be emphasized over traditional hardware sales (which are under threat of commoditization).
The risk, of course, is that the telecom operator business is very conservative and the change may prove too disruptive for operators' tastes. On the other hand, if the old Mobile Networks model wasn't generating proper value anyway (a while back, Light Reading concluded that Radio Networks and Core Software together might have been loss-making in Q1), a more radical renewal may be a rational alternative if the cycle of low profitability is to be seriously broken.
u/Mustathmir — 7 hours ago
▲ 40 r/Nok
Cramer: Nokia is a buy
Nokia: “It’s in the data center. It’s considered to be part of the cloud part of that wedding layer cake that I gave you, and it’s just also got a great defense contract. So it’s got the cloud and it’s got defense. What can I say? It’s a buy.”
I believe he's spoken positively about Noka April 15, April 30 and now May 11.
One may have many opinions about Cramer's expertise, but once again Nokia was presented in a positive light, which is likely to increase Nokia's visibility and potentially the appetite for buying into it.
u/Mustathmir — 2 days ago
▲ 29 r/Nok
The San José 20x capacity expansion: why Nokia is an AI infrastructure sleeper
Some investors are hesitating because Q1 earnings weren't exceptional on profit or revenue. That's the wrong lens.
Current profitability is partly suppressed by deliberate investments in capacity and new products. The real signal in Q1 was AI & Cloud orders of €1B or 67% above the 2025 quarterly average, against only €350M in AI & Cloud revenue. A 3x order-to-revenue ratio with 12-18 month optical lead times means Q1 orders are primarily 2027 revenue. The backlog is being built now.
And Q1 orders don't yet include meaningful IP Networks contribution. CEO Hotard explicitly said IP Networks design wins would begin converting to orders from Q2 onward. Optical momentum plus accelerating IP contribution through H2 could make 2026 a watershed year for Nokia's AI and data center order book.
Then consider what happens when Nokia's San José fab (with up to 20x the capacity of the current facility) enters commercial production toward year-end. Customers are already booking that future capacity. The order trajectory hasn't yet reflected the full supply availability that's coming.
The market is still pricing Nokia partly on current earnings. The leading indicator is the AI & Cloud order pipeline. Those are two very different pictures of the same company.
u/Mustathmir — 2 days ago
▲ 38 r/Nok
Nokia AI & Cloud orders could exceed €4B in 2026
Nokia booked €1B in AI & Cloud orders in Q1 alone, against a FY2025 total of €2.4B, already 67% above last year's quarterly average. While order lumpiness might partly explain the strong orders in Q1, here's why full-year 2026 orders could exceed €4B and what that eventually means for Nokia's revenue mix.
Three drivers are converging.
- Competitors are sold out: Lumentum's CEO has stated production is booked through 2028, Ciena has a $7B backlog. When incumbents can't supply, customers qualify additional vendors.
- Nokia's San José fab with up to 20x current capacity will be the natural beneficiary with customers booking 2027 delivery capacity placing those orders in 2026.
- IP Networks design wins are expected to convert to orders from Q2 onward per CEO Justin Hotard and wasn't yet contributing to Q1's €1B figure. If optical momentum continues and IP accelerates, H2 order intake improves materially.
The revenue math when deliveries catch up to orders:
With 12-18 month optical lead times, 2026 orders are primarily 2027+ revenue. The question is what Nokia looks like when annual deliveries normalize to match a €4B order rate.
Let's assume that FY2025 AI & Cloud revenue was €1B which is a rough estimate, not a disclosed figure. Adding €3B incremental AI & Cloud revenue to Nokia's ~€20B group revenue gives approximately €23B total, making AI & Cloud roughly 17% of group revenue. The more striking number is at the NI segment level. Nokia's NI revenue was approximately €8B in 2025. At €4B AI & Cloud revenue, for simplicity assuming it all flows through NI, that's 4/(8+3) = 36% of NI segment revenue. This is thus a forward projection of what Nokia's revenue mix would look like when deliveries normalize to the current order rate, not a description of today's revenue.
At that point Nokia is no longer a telecom equipment vendor with an optical division attached. The AI and cloud business is the core of NI. This scenario would still represent the early stages of Nokia's transformation as an AI supercycle beneficiary. And the potential €4B in AI & Cloud orders may itself be a transitional figure. Nokia's new optical DSP portfolio enters the market in H2 2027, the San José fab reaches full production in 2027, and IP Networks is only beginning its order ramp in 2026. Each driver probably accelerates further in 2027-2028. If the order trajectory continues, €4B in 2026 could look like the early chapter of a much larger story.
u/Mustathmir — 6 days ago
▲ 32 r/Nok
The article's four valuation scenarios for Nokia: $9 - $15.5 - $21 - $26.
Author Gav Blaxberg is the 27-year-old founder of Wolf Financial, with a background in asset management at Goldman Sachs and private equity at Versa Capital Management.
u/Mustathmir — 8 days ago
▲ 30 r/Nok
With Nokia's optical business getting most of the attention after Q1, it's worth focusing on a metric that better predicts where revenue is heading: AI & Cloud order intake.
Getting the growth numbers right first
Nokia's AI & Cloud sales grew 94% year-over-year in reported terms in Q1 but that includes Infinera consolidation and currency effects. Strip those out and the constant currency, portfolio-adjusted growth was 49%. Still great, but the right number to use for underlying momentum. The revenue base remains relatively modest at €350M in Q1. Optical Networks, separately, grew 56% reported or 20% on the same constant currency and portfolio-adjusted basis.
Why orders matter more than current revenue
The more forward-looking signal is order intake. Nokia received approximately €1B in AI & Cloud orders in Q1 alone. Compare that to €2.4B for all of FY2025 with a quarterly average of €600M. Q1 2026 came in roughly 67% above that average.
Why does this matter more than current revenue? Because according to CEO Justin Hotard, optical order-to-delivery lead times are typically 12-18 months, with IP Networks somewhat shorter. This means the surge in Q1 orders is not primarily a 2026 revenue story but predictor of what's going to happen 2027 onwards. The backlog being built now is what funds the next leg of growth.
IP Networks is joining optical as a growth driver
Most Nokia coverage focuses on optical. But Hotard was explicit on the Q1 call: "I would say that the optimism we have on the 18%-20% is across both sides of the business right now." Design wins in IP Networks are expected to convert into orders from Q2, meaning both Optical and IP Networks are expected to contribute meaningfully to the 18-20% combined NI growth guidance for 2026.
The 2027 setup
The convergence of three factors makes 2027 particularly significant.
- The San José InP fab with up to 20x the capacity of the current facility for complex InP components enters production in late 2026.
- Then the growing order backlog built in 2026 converts to revenue starting in 2027.
- IP Networks order acceleration, if Q2 confirms the trend, adds a second revenue stream many investors may still not totally recognize.
To sum up, Nokia's Q1 wasn't just a strong quarter. It was the quarter that built the pipeline for 2027.
u/Mustathmir — 10 days ago
▲ 29 r/Nok
While optical networks are currently in focus, Nokia’s AI exposure is not limited to optical alone. IP Networks are increasingly relevant for data center interconnect and routing, and design wins here are expected to convert into orders starting Q2. Or as CEO Justin Hotard put it: "I would say that the optimism we have on the 18%-20% is across both sides of the business right now." In other words, both Optical and IP Networks are expected to contribute meaningfully to this year’s growth.
This is also underscored by BofA who clearly before the Q1 report updated its view on Nokia and valued both optical and IP networks with the same multiple:
"The bank’s analysts, led by Oliver Wong, moved to a sum-of-the-parts valuation from an EV/EBITDA methodology, applying a 30x multiple on 2027 estimated EBIT for Nokia’s Optical and IP Networks business and a 10x multiple on the rest of the company."
The underlying rationale is not just growth, but system-level integration. Nokia can combine optical transport and IP routing into a more energy-efficient and scalable architecture, which can lower total cost of ownership for data center operators. In an environment where power and efficiency are becoming binding constraints, this matters.
Finally, Nokia's third AI leg is AI-RAN in Nokia's wireless business which was the main reason NVIDIA invested $1B in Nokia in October 2025. This is still work in progress with commercial deployment expected to follow if trials with currently 10 operators demonstrate the performance advantages Nokia and NVIDIA are targeting.
u/Mustathmir — 11 days ago
▲ 14 r/Nok
While optical demand explains most of Nokia's recent strength, it's not just that. In IP Networks design wins are expected to convert into orders starting in Q2, broadening growth beyond optical. CEO Hotard:
"In Q1, we also saw strong growth in our IP Networks pipeline as we built deeper engagements with our AI and cloud customers on switching and routing. We were awarded new design wins and continue to build a strong pipeline of further opportunities. We expect this to translate into new orders over the coming quarters. I would say that the optimism we have on the 18%-20% is across both sides of the business right now."
In other words, both Optical and IP Networks are expected to contribute to the 18-20% combined optical and IP networks growth.
Then we also have the third and less immediate AI story in Nokia: AI-RAN which was the reason NVIDIA invested $1B in Nokia. Trials are going on and 2027 will show what appetite there is for operator adoption.
u/Mustathmir — 14 days ago
▲ 26 r/Nok
Morgan Stanley analyst Terence Tsui raised the firm’s price target on Nokia (NOK) to EUR 11 (about $12.88) from EUR 8.50 and keeps an Overweight rating on the shares.
u/Mustathmir — 14 days ago
▲ 29 r/Nok
Cramer's lightning round: Nokia: "I think it's a winner. It's back. I can't believe it. It finally did come back, and I got to hand it to those guys for sticking around because, wow, I think it's got a lot of good technology."
Video link here, Nokia discussed 2:22 onwards.
COMMENT: If nothing else, this kind of pronouncements may educate retail investors on what kind of company Nokia is today and that it's an active participant in the AI supercycle.
u/Mustathmir — 15 days ago
▲ 9 r/Nok
Currently Nokia is +3% and Ciena -7%. Might this be sector rebalancing? Institutional investors harvesting part of the massive gains from Ciena and redeploying them into the resurgent AI networking alternative Nokia which quite possibly currently offers a better risk-reward profile following its strong Q1 messaging.
u/Mustathmir — 15 days ago
▲ 17 r/Nok
Maybe this hasn't been mentioned: April 24 Craig-Hallum rated Nokia as a BUY with target price $15. There is no additional info available.
u/Mustathmir — 15 days ago
▲ 20 r/Nok
Some issues in Q1 and the updates given that I think merit to be highlighted. Many of them imply strikingly positive revisions of growth assumptions but also seriously impactful "facts on the ground" regarding AI & Cloud orders.
1) Clear growth pockets in Q1 despite modest overall growth (4% in constant currencies)
- Optical: 20% organic growth
- AI & Cloud: +49%
- Mission-critical enterprise & defense: +19%
- Technology licensing: +10%
2) Orders in Q1 point to forward momentum
- €1B AI & Cloud orders vs €350M revenue (≈3x), indicating strong backlog build. This can be compared to €2.4B of AI & Cloud orders in FY 2025 (on average €600M per quarter).
- Group book-to-bill >1, and well above 1 in Network Infrastructure.
- Hotard indicated optical order-to-delivery lead times are typically 12–18 months (somewhat shorter in IP). This implies that a meaningful share of recent orders is still to be delivered, supporting revenue visibility partly extending into 2027.
3) Guidance and market expectations moved up materially
- NI growth 2026: 6–8% → 12–14%
- Optical + IP growth 2026: 10–12% → 18–20%
- Hyperscaler capex (2026): $540B → $700B
- AI & Cloud market CAGR (2025–2028): 16% → 27%
4) Additional investments will be made to the San José fab
- Demand is growing so considerably that Nokia is increasing its investments from what the plan was.
- Justin Hotard: "I think one thing we've maybe just to clarify in case we haven't clarified in the past. Fab 2, when we shared in November, what we talked about was Fab 2 being able to be sufficient to meet the demands of the guidance we provided, and there was additional capacity on top. Obviously, we're not making any announcements about additional manufacturing capacity at this time, but that's the way I would think about it, is that in the prior guidance, there was excess capacity and ability to build. I would take. If you kind of stitch the conversation together, I'll stitch it together for you. We're making additional investments. That probably means that part of what we're doing there is investing in ramping the Fab 2 at scale."
5) San José InP fab on track
- Production starts in 2026, with more material impact from 2027 onward. This is key for capacity and cost. It's also worth noting that the 2026 guidance depends very little on the new fab as per Hotard: "The reality is Fab 2 is a fraction of the ramp for 2026. It's much more material to longer term."
6) Infinera integration ahead of schedule
- Both synergies and operational integration appear to be progressing smoothly.
7) IP Networks as second leg
- Design wins are expected to convert into orders starting Q2, potentially broadening growth beyond optical. Hotard: "I would say that the optimism we have on the 18%-20% is across both sides of the business right now." In other words, both Optical and IP Networks are expected to contribute to the 18-20% NI growth.
8) Growth is mainly volume-driven, not pricing-led
- Margin expansion likely comes later via scale and lower unit costs (fab ramp), not near-term pricing.
9) Wireless networks is still the weak spot
- Flat revenue and limited transparency due to reporting structure. Given the high margins of patent licensing (Technology Standards), its inclusion in MI likely masks weaker underlying profitability in the wireless unit. Light Reading speculated that the combined Core Software and Radio Networks units may currently be lossmaking.
To sum up
Q1 illustrates the strength of a demand-driven optical cycle with growing backlog visibility. Current profitability is lowish but there is improved visibility into 2027+, when capacity (San José fab) and scale effects are expected to translate into more meaningful earnings growth in Optical and IP Networks. The no-growth wireless business is still far from acceptable profitability. Cost savings and NVIDIA-based AI-RAN cooperation is meant to bring a change to this.
One more thing worth highlighting: "We now expect the addressable market in AI & Cloud to grow at a 27% CAGR (2025–2028), compared to the 16% we estimated in November."
At 27% CAGR, the addressable market DOUBLES in three years. Growth at that pace increases the likelihood of supply constraints, making it harder for incumbents to fully meet demand. In that environment, vertical integration (InP, own fab capacity) becomes a competitive advantage, not just a cost lever. That, in turn, improves Nokia’s chances of gaining share, as customers may need to qualify additional suppliers rather than rely only on their usual vendors.
At the beginning of the year, Nokia's investment thesis was largely based on AI demand and related growth assumptions. After Q1, this is supported by measurable evidence: clear order book growth, guidance increase, and significant strengthening of the addressable market's growth outlook.
u/Mustathmir — 19 days ago