The Nokia you once mocked has seen its stock price rise 70% this year.
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The Nokia you once mocked has seen its stock price rise 70% this year.
The forgotten Nokia is making a comeback on the AI front.
Navigating Web3 tides with focused insightsBy Xiao Bing, TechFlow
In 2014, Microsoft acquired Nokia’s mobile phone business for $7.2 billion.
That year, everyone assumed the story of this Finnish company—founded in 1865—had come to an end. The iconic Nokia 3310—the indestructible phone that could crack walnuts and withstand being thrown against a wall, beloved by a generation for its Snake game—along with the entire company behind it, was relegated to the “tears-of-a-bygone-era” photo album.
Eleven years later, Jensen Huang called, offering them $1 billion.
Nokia’s stock has risen approximately 73% since early January this year and is up 130% year-on-year.
This isn’t a “dead cat bounce” of an aging stock—it’s an underappreciated undercurrent within the broader AI narrative spanning 2025–2026.
And almost no Chinese investor is seriously discussing it.
Who Is Justin Hotard?
The story begins with a name.
In February 2025, Nokia’s Board of Directors announced that current CEO Pekka Lundmark would step down, and that effective April 1, an American named Justin Hotard would assume the role.
This marks the first time in Nokia’s 160-year history—since its founding in 1865—that its CEO is a U.S.-born executive.
Hotard fits the classic tech-industry profile of someone “not widely known, yet consistently positioned at the epicenter of every major trend.” He holds a B.S. in Electrical Engineering from the University of Illinois and an MBA from MIT Sloan. After spending eight and a half years at Hewlett Packard Enterprise (HPE), he rose to lead HPE’s High-Performance Computing (HPC) and AI Labs—and personally delivered the U.S. Department of Energy’s first exascale supercomputer. In early 2024, he was recruited by Intel to head its Data Center and AI Group, reporting directly to CEO Pat Gelsinger.
Notice his background: HPC, data centers, and AI—three keywords utterly disconnected from Nokia’s public image over the past decade.
What does Nokia do? It builds base stations, telecom equipment, and fiber-optic infrastructure—selling primarily to network operators. A quintessentially slow-moving, market-overlooked “old Europe” hardware company.
Yet, in early 2025, Nokia’s Board made a seemingly counterintuitive decision: rather than appointing someone steeped in telecom, it chose someone deeply versed in AI.
In the official announcement, Board Chair Sari Baldauf stated: “AI and the data center market are key growth areas for Nokia’s future.”
At that moment, nearly no one took it seriously. Market reaction was muted; the stock edged slightly higher. Analysts churned out predictable reports titled things like “Finnish Legacy Firm Appoints New CEO—Can He Reverse Decline?”
No one realized the company was quietly swapping engines.
A Severely Underestimated Acquisition
If viewed in isolation, Hotard’s appointment appears merely a routine executive reshuffle. But place it alongside another event that occurred six months earlier—and the entire script changes.
In June 2024, Nokia announced its $2.3 billion acquisition of U.S.-based Infinera.
What does Infinera do? It specializes in optical networking—essentially, the fiber-optic communication equipment linking data centers to data centers, and server racks to server racks.
If you’ve spoken with professionals building AI infrastructure, you’ll know one hard truth:
The biggest bottleneck in AI data centers isn’t GPUs—it’s optical interconnects.
Nvidia packs 72 GPUs into a single rack, all of which must exchange data at blistering speeds. A large AI data center may contain tens of thousands of GPUs—all needing to communicate. And across geographically distributed data centers, training datasets must be synchronized continuously. Every additional cluster multiplies optical module demand exponentially.
That’s why, over the past two years, optical module companies—including U.S.-based Coherent and China-based Zhongji Xunsheng (AAC) and New Optics—have seen their stocks soar.
Infinera is among the rare firms possessing both photonic integrated circuit (PIC) technology and expertise in intra-data-center interconnects. It already maintains established customer relationships with North America’s hyperscale cloud providers—Microsoft, Amazon, and Google.
When Nokia signed the deal in June 2024, market commentary largely framed it as “a traditional telecom company acquiring another traditional fiber-optics firm”—a textbook case of “two elephants huddling for warmth.”
But after the deal closed in February 2025 and Infinera was consolidated into Nokia’s financial statements, the Finnish legacy firm’s financial metrics began shifting dramatically:
- Optical networking revenue grew 17% year-on-year for full-year 2025
- In Q1 2026, optical networking sales reached €821 million—up 20% YoY—surpassing IP and core software to become Nokia’s second-largest business unit
- Sales attributable to AI and cloud customers surged 49% YoY in a single quarter
Most critically: In Q1 2026, AI and cloud customers placed €1 billion in orders with Nokia.
To put that in perspective: that single-quarter order volume exceeded Infinera’s total annual revenue prior to its acquisition.
And yet—outside Western tech media—this development has drawn virtually no attention.
Jensen Huang’s Phone Call
What truly ignited the market was October 28, 2025.
That day, at Nvidia’s GTC conference in Washington, the company announced: Nvidia will invest $1 billion in Nokia at a subscription price of $6.01 per share.
Note the detail: “$6.01 per share” is a subscription price, not the prevailing market price. Nvidia did not purchase shares on the open market; instead, Nokia issued new shares specifically for Nvidia—a strategic equity investment, not merely a financial one.
Why did Jensen Huang hand Nokia $1 billion?
Nvidia’s official statement reads: The two companies will jointly develop AI-RAN (AI Radio Access Network)—an AI-enhanced wireless access network. Nokia’s 5G and 6G software will be ported onto Nvidia’s CUDA platform; and Nvidia’s Arc-Pro accelerator—custom-built for telecom—will be embedded directly into Nokia’s base stations.
T-Mobile US will serve as the first pilot operator. Dell will supply servers.
On the surface, this sounds like yet another generic “AI赋能 [empowering] X industry” story. But the real revelation hides in a technical nuance that 99% of people overlook.
First, some context: In the AI-RAN space, Nokia is not alone. Its biggest rival is Ericsson—also headquartered in Northern Europe.
On paper, Ericsson and Nokia perform identical functions: supplying 5G/6G base station equipment to telecom operators. Yet when it comes to “how to integrate GPUs into base stations,” they have pursued two diametrically opposed architectural paths.
Engineers jokingly refer to this divide as a “religious war.”
The first path is called Lookaside acceleration. This is the route Ericsson and Intel have taken. Simplified: the CPU remains the primary controller inside the base station, while the GPU serves only as a “sidekick assistant.” When accelerated computation is required, the CPU offloads tasks to the GPU, which then returns results. Data shuttles repeatedly between CPU and GPU.
The second path is called Inline acceleration. This is the route Nokia and Nvidia are taking. Simplified: incoming network data flows directly into the GPU first; only after GPU processing does it pass to the CPU. Here, the GPU becomes the protagonist—and the CPU, the supporting actor.
Does this sound like a trivial engineering sequencing issue?
No—it reflects a fundamental philosophical divergence about “where computing should reside in the future.”
Nvidia’s entire corporate existence rests on proving that the GPU—not the CPU—should sit at the center of data processing. The design philosophy underpinning CUDA and its entire ecosystem is unequivocally “GPU-centric.” Lookaside architecture, by contrast, presupposes “CPU remains king”—a foundational premise fundamentally incompatible with Nvidia’s worldview.
So when Nvidia sought a telecom partner, Ericsson was never a viable option. It needed a partner willing to place the GPU front-and-center.
Nokia is that partner.
That’s why this $1 billion investment is far more than a “strategic partnership.” Jensen Huang, in essence, stamped his seal of approval on a new frontier of the AI narrative: He’s buying the gateway through which Nvidia’s GPUs can enter the world’s 5 million base stations.
According to analyst firm Omdia, the cumulative AI-RAN market is projected to exceed $200 billion by 2030.
If this narrative proves correct, Jensen Huang’s $1 billion may rank among the highest-return investments of his entire career.
Geopolitics Gave a Helping Hand
Nokia’s resurgence also carries sensitive geopolitical undertones.
On April 13, 2026, Oliver Wong, an analyst at Bank of America, upgraded Nokia from “Neutral” to “Buy,” raising its target price sharply—from €6.87 to €10.70. That same day, Nokia’s stock surged 9.67%, with trading volume exploding 178% above its three-month average.
In his report, Wong listed four reasons why Nokia remains undervalued. His third point was phrased diplomatically—but its meaning was crystal clear:
“As European nations progressively restrict Huawei and ZTE, Nokia has effectively become ‘the last remaining Western sovereign-grade supplier.’”
Put plainly: If Europe wants to build sovereign data centers and sovereign 5G/6G networks, Chinese equipment is off-limits, and there is no equivalent U.S.-based vendor—leaving only Nokia and Ericsson as viable Western suppliers. Yet Ericsson lacks full-stack optical networking capabilities; Infinera has been acquired by Nokia; and Cisco is a U.S. firm. Therefore, funding for Europe’s sovereign cloud initiatives flows almost exclusively to Nokia.
This is a textbook case of “geopolitical arbitrage”—a windfall gift bestowed upon Nokia by shifting global order. Simply by staying in the race, Nokia stands to capture this tailwind.
Combine that with surging optical networking demand from U.S. hyperscalers—and T-Mobile’s bet on AI-RAN—and three distinct capital streams are now converging on Nokia from three separate directions.
It Took the Market 18 Months to Catch On
Assemble all these threads, and a remarkably dramatic timeline emerges:
- June 2024: Nokia announces acquisition of Infinera
- February 2025: Hotard appointed new CEO
- October 2025: Nvidia invests $1 billion
- April 13, 2026: Bank of America upgrades rating; stock jumps +9.67% in a single day
- April 22, 2026: Q1 earnings reveal €1 billion in AI/cloud orders and 20% YoY growth in optical networking
- April 27, 2026: CFRA doubles its price target—from $8 to $16—sending Nokia’s stock to its highest level since 2015
Did you notice?
The fundamentals began shifting 18 months ago—but it took the market a full 18 months to connect the dots.
This is the classic “value discovery” process. When a narrative remains unarticulated, investors dismiss it as “old wine in old bottles.” Once the story crystallizes, valuation has often already rebounded significantly.
Nokia currently trades at a forward P/E of 26x—an unremarkable multiple for an optical networking business growing at 17%. Yet compared to its lows earlier this year, it’s clearly no longer the “forgotten stock” lying motionless on the floor.
For the past two years, Chinese investors’ attention has remained laser-focused on Nvidia, TSMC, Broadcom, and AMD—the undisputed engines powering the AI wave.
But beyond the engine lie the transmission, driveshaft, tires, and highway.
The AI narrative is now expanding beyond “chips” into “pipes.”
Stories around optical module vendors have circulated for over a year. Next up for market re-rating may be base stations, fiber optics, data center power systems, and cooling infrastructure.
History doesn’t repeat—but it rhymes.
When a new technological paradigm truly arrives, the greatest alpha may not reside in the most obvious places.
It resides in corners you assumed had long been forgotten.
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