Nokia stock rose 3.53% to about $13 after the Finnish telecom equipment maker said its AI and cloud-related net sales jumped 49% year over year in the first quarter of 2026 and it now expects that business to grow at a 27% compound annual rate through 2028.
The company also said it took in 1 billion euros, or $1.17 billion, in new orders in the quarter, a sign that the push beyond traditional networking is starting to translate into business momentum. For investors, the immediate question is whether Nokia can keep turning those orders into revenue as it builds a larger role in artificial intelligence infrastructure and defense communications.
The latest update lands after a year in which Nokia moved deeper into AI-native networking. Back in October, Nvidia invested $1 billion into Nokia as part of a collaboration to co-develop AI-RAN solutions, and Nokia has been porting 5G-Advanced and 6G software stacks onto Nvidia’s hardware. The company also said its strategic plan now ties together radio access networks, edge computing and AI-enabled infrastructure in a way that makes the hardware story harder to separate from the software one.
That shift is already showing up outside the commercial network market. Back in March, Nokia joined a group with Anduril and European partner COBBS to develop a counter-unmanned aerial system capability for the Belgian military. The companies co-developed the 5G Comms Sentry Tower, which integrates Nokia’s private 5G hardware and tactical communications into Anduril’s modular Sentry platform. The system was designed to provide deployable, secure cellular connectivity that can carry real-time data from autonomous sensors, drones and AI decision engines.
The tension for Nokia is that the growth story is now tied to two of the most competitive fields in tech: AI infrastructure and defense systems. Hyperscalers are pouring hundreds of billions of dollars into AI infrastructure, and sovereign governments are demanding next-generation defense protocols, which gives Nokia a larger addressable market but also raises the bar on execution. The company’s revised outlook from 16% to 27% CAGR through 2028 suggests management thinks that demand is durable, not a one-quarter surge.
For now, the market appears willing to believe the pivot. The stock reaction followed a quarter that delivered both stronger sales and a higher long-term forecast, the kind of combination that can reset expectations fast. What comes next is whether Nokia can keep the AI and cloud business growing at that pace while proving its partnerships with Nvidia and Anduril are more than headline-grabbing side projects.
