Nokia's Optical Bet Rests on Whether Carrier AI Budgets Turn Into Orders

Nokia's shares climbed 3.9% to €7.72, extending a recovery from the slide that followed its quarterly report. Two separate forces are feeding the move: a broker upgrade to "Buy" and a fresh signal that telecom operators see AI as a revenue opportunity — one that could ultimately flow back to Nokia as demand for network gear.

Refinitiv/Verus raised its rating on Nokia's depositary receipts from "Hold" to "Buy" on Monday. The call landed as confidence in AI infrastructure spending firmed up across the sector. Reuters reported a revival in AI-related trading after CoreWeave forecast it would turn profitable by 2028.

Carrier Survey Points to Wholesale Bandwidth

An Omdia survey published in cooperation with Nokia offers a concrete data point on where operators expect AI money to come from. Of 122 telecom provider representatives polled, 61% named high-bandwidth wavelength services as one of their two most important AI-related revenue opportunities.

That matters for Nokia because operators hoping to sell such services will need the underlying network technology. The opportunity runs on two levels: carriers hunting new income streams, and Nokia positioning its portfolio to supply the infrastructure those services require. A visible revenue case on the customer side carries more weight than enthusiasm for AI in the abstract — provided it translates into investment decisions. What Nokia actually offers, and how well it fits operators' plans, is where the market thesis will be tested.

Data Centre Optics Under Review

Nokia is also examining options inside data centres. Manager Rob Shore said Friday that the company is exploring opportunities in optical connections within these facilities, including optics integrated closer to the chips and the supply of external lasers.

Should investors sell immediately? Or is it worth buying Nokia?

It is a sensible expansion path if Nokia turns it into competitive products. For now, the evaluation signals willingness to open additional fields of use; what counts for valuation is concrete product decisions and subsequent customer uptake. Investor interest in optical AI connections is easy to attract — economic weight only arrives with gear customers actually deploy. An entry would be most compelling if it complements existing activities and unlocks extra demand. Until then, business already visible with customers deserves more weight.

One New Zealand Widens Its Bet

That visible business has a fresh example. Nokia confirmed yesterday an expanded collaboration with One New Zealand. The operator selected Nokia's Assurance Center and Autonomous Networks Data Suite, alongside joint research and development work and consulting aimed at advancing network autonomy.

Here the story gains a tangible anchor: next to talk of new optical fields stands a specific product selection by a customer. The partnership reflects well on Nokia if it successfully supports the operator's autonomy goals, and it ties the strategic direction to real-world use.

The Order Book Behind the Upgrade

The operating backdrop for the buy call comes from the third-quarter 2026 report published about a week ago. AI and cloud revenue grew 123% year on year, and order intake jumped 118%. Management said demand in Optical and IP Networks exceeds supply, making execution the key checkpoint — the enlarged order backlog supports the outlook, but delivery capacity will decide how much of it converts.

Comparable operating profit rose 35% to €605 million in the same period, beating market expectations. For Optical and IP Networks combined, Nokia expects growth of 25–30% next year.

Accelerated restructuring and integration costs weighed on the reported operating margin despite improved comparable figures. Beyond growth, then, investors are watching earnings quality: demand strengthens the profit picture only if operating progress absorbs the extra charges.

A Strong Finish Is the Proof

Management guides for a sequential net sales increase of 20–24% in the final quarter, and targets comparable operating profit for the full year above the midpoint of its confirmed €2.1–2.6 billion range. That gives the upgrade an operational foundation — and sets up the year-end sprint as its real test. Deliver the promised revenue jump, and the recovery gets support from Nokia's own business rather than from sentiment alone.

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