Nokia (NOK) AI Stock Analysis

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Nokia

(NYSE:NOK)

Rating:64Neutral

Price Target:―

Nokia's overall score reflects a blend of financial stability, technical neutrality, and valuation concerns. Strong cash flows and a robust balance sheet are offset by revenue volatility and valuation challenges. Earnings call insights highlight growth potential in strategic areas but also reveal profitability hurdles due to unforeseen charges and external factors like tariffs.

Nokia (NOK) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$28.18B

Dividend Yield3.86%

Average Volume (3M)14.45M

Price to Earnings (P/E)35.7

Beta (1Y)0.45

Revenue Growth-9.96%

EPS Growth-6.83%

CountryUS

Employees78,434

SectorTechnology

Sector Strength84

IndustryCommunication Equipment

Share Statistics

EPS (TTM)0.03

Shares Outstanding5,455,850,600

10 Day Avg. Volume12,446,793

30 Day Avg. Volume14,445,413

Financial Highlights & Ratios

PEG Ratio0.04

Price to Book (P/B)1.14

Price to Sales (P/S)0.00

P/FCF Ratio27.87

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$6.75

Price Target Upside27.84% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

Nokia Business Overview & Revenue Model

Company DescriptionNokia Oyj provides mobile, fixed, and cloud network solutions worldwide. The company operates through four segments: Mobile Networks, Network Infrastructure, Cloud and Network Services, and Nokia Technologies. It offers products and services for radio access networks covering technologies from 2G to 5G, and microwave radio links for transport networks. The company provides fixed networking solutions, such as fiber and copper-based access infrastructure, and cloud and virtualization services, as well as wi-fi portfolio, including mesh solutions and cloud-based controllers; IP routing solutions for IP aggregation, and edge and core applications for residential, business, mobile, and industrial services; a portfolio of optical networks comprising portfolio coherent optical transponders, optical transport network switchers, wavelength-division multiplexers, reconfigurable optical add-drop multiplexer solutions, and optical line systems for metro access and aggregation, data center interconnect, regional, and long-haul/ultra-long-haul applications; and submarine networks. In addition, it offers business applications software, cloud and cognitive services, core networks software, and enterprise solutions. Further, the company provides hardware, software, and services, as well as licensing of intellectual property, including patents, technologies, and the Nokia brand. It serves communications service providers, webscales, hyperscalers, digital industries, and government. Nokia Oyj was founded in 1865 and is headquartered in Espoo, Finland.

How the Company Makes MoneyNokia generates revenue through several key streams. A significant portion of its income comes from its Networks business, which involves selling equipment and services for wireless and fixed-line networks. This includes 4G and 5G infrastructure, IP routing, optical networks, and software solutions. The company's Technologies segment earns money by licensing its extensive portfolio of patents and technologies to other companies, particularly in the mobile device and consumer electronics sectors. Moreover, Nokia has strategic partnerships with various technology and telecommunications companies to enhance its service offerings and expand its market reach. These partnerships, along with continuous investments in research and development, help Nokia maintain its competitive edge and drive revenue growth.

Nokia Earnings Call Summary

Earnings Call Date:Apr 24, 2025

(Q1-2025)

% Change Since: 0.19%|

Next Earnings Date:Jul 24, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed picture with strong growth in network infrastructure and cloud services, positive cash flow, and strategic progress with the Infinera acquisition. However, the decline in net sales, significant one-off charges, tariff impacts, and challenges in achieving profit targets offset these gains.

Q1-2025 Updates

Positive Updates

Strong Growth in Network Infrastructure

Network infrastructure segment showed 11% growth, with optical networks growing 15%, fixed networks 9%, and IP networks 7%.

Cloud and Network Services Expansion

Cloud and Network Services grew 8% with strong demand for 5G core, securing significant wins at AT&T, Boost Mobile, Ooredoo Qatar, and Telefonica.

Positive Free Cash Flow

Generated over EUR 700 million of free cash flow in the quarter, ending with a net cash position of EUR 3 billion.

Infinera Acquisition Value

Infinera acquisition is expected to accelerate product roadmaps and increase access to hyperscale customers, with strong order growth in optical networks.

T-Mobile RAN Agreement Extension

Announced an extension of the RAN agreement with T-Mobile U.S., indicating strong partnership and potential for future growth.

Negative Updates

Decline in Net Sales

Net sales declined 3% year-over-year, largely due to a challenging comparison in Nokia Technologies, which declined 52%.

Impact of One-Off Charges

Operating margin in mobile networks was negatively impacted by a EUR 120 million one-off contract settlement charge.

Tariff Impact on Operating Profit

Potential tariffs could have a EUR 20 million to EUR 30 million impact on operating profit in Q2, with no assumption made for the second half of 2025.

Lower Gross Margin

Gross margin decreased by 820 basis points to 42.3%, mainly due to lower Nokia Technologies net sales and one-off charges.

Challenges in Achieving Profit Targets

Given unexpected charges, it will be more challenging to achieve the top end of the operating profit range for 2025.

Company Guidance

In the recent Nokia First Quarter 2025 Results Call, several key metrics were discussed, highlighting both challenges and successes. Nokia's net sales declined by 3% year-over-year, but when adjusted for over EUR 400 million of catch-up net sales in Nokia Technologies, they actually grew by 7%. Network infrastructure saw an 11% growth, with optical networks particularly strong at 15%. Cloud and Network Services grew 8% due to high demand for 5G core. Despite a contraction in net sales, Mobile Networks showed stabilization with a 2% increase. Operating margins saw varied performance across segments, with network infrastructure expanding by 190 basis points and cloud and network services seeing a substantial increase of 930 basis points. Free cash flow was robust at over EUR 700 million, ending the quarter with a net cash position of EUR 3 billion. However, profitability was impacted by a EUR 120 million contract settlement in Mobile Networks. Looking forward, Nokia expects tariffs to potentially impact operating profit by EUR 20 million to EUR 30 million in Q2, with proactive measures being taken to mitigate exposure. The guidance remains unchanged, although achieving the top end of the operating profit range is now seen as more challenging due to unexpected charges.

Nokia Financial Statement Overview

Summary

Nokia presents a mixed financial picture with solid cash flow performance and a strong balance sheet offset by revenue volatility. The company has demonstrated improved profitability margins and effective cost management. Despite challenges in revenue growth, Nokia maintains financial resilience through strong cash generation and reduced leverage.

Income Statement

Positive

Nokia's revenue has shown volatility, with a notable drop from 2022 to 2024. However, gross profit margins remain relatively stable, indicating consistent cost management. The net profit margin improved significantly from 2023 to 2024, reflecting better profitability despite lower revenues. The EBIT and EBITDA margins are satisfactory, indicating operational efficiency.

Balance Sheet

Positive

The balance sheet illustrates a strong equity position with an equity ratio of around 52.8% in 2024. The debt-to-equity ratio has improved, showing reduced leverage. Return on equity has increased, reflecting improved profitability relative to shareholder investments. Overall, the balance sheet reflects financial stability and effective debt management.

Cash Flow

Positive

Operating cash flow has significantly improved in 2024, showcasing robust cash generation capabilities. Free cash flow has grown impressively, indicating effective capital expenditure management. The operating cash flow to net income ratio is strong, suggesting efficient conversion of income into cash.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
8.86B	19.22B	22.26B	24.91B	22.20B	21.87B
	Gross Profit
3.75B	8.86B	8.69B	10.22B	8.83B	8.21B
	EBIT
327.00M	2.00B	1.66B	2.32B	2.16B	918.00M
	EBITDA
859.00M	3.43B	2.94B	3.55B	3.23B	2.05B
	Net Income Common Stockholders
-204.00M	1.28B	665.00M	4.25B	1.62B	-2.42B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
7.22B	8.91B	8.24B	9.16B	9.60B	8.28B
	Total Assets
39.26B	39.15B	39.86B	42.94B	40.05B	36.28B
	Total Debt
5.07B	4.75B	5.19B	5.52B	5.66B	6.49B
	Net Debt
-478.00M	-1.87B	-1.05B	52.00M	-1.03B	-454.00M
	Total Liabilities
18.44B	18.40B	19.23B	21.52B	22.59B	23.65B
	Stockholders Equity
20.73B	20.66B	20.54B	21.33B	17.36B	12.56B
Cash Flow		Free Cash Flow
1.11B	2.02B	665.00M	873.00M	2.07B	1.28B
	Operating Cash Flow
1.38B	2.49B	1.32B	1.47B	2.63B	1.76B
	Investing Cash Flow
-354.00M	-117.00M	1.04B	-1.88B	-1.79B	-1.52B
	Financing Cash Flow
-1.72B	-2.00B	-1.50B	-837.00M	-1.21B	883.00M

Nokia Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price5.28

Price Trends

50DMA

5.13

Positive

100DMA

5.03

Positive

200DMA

4.69

Positive

Market Momentum

MACD

0.06

Positive

RSI

50.65

Neutral

STOCH

59.77

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NOK, the sentiment is Neutral. The current price of 5.28 is below the 20-day moving average (MA) of 5.32, above the 50-day MA of 5.13, and above the 200-day MA of 4.69, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 50.65 is Neutral, neither overbought nor oversold. The STOCH value of 59.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NOK.

Nokia Risk Analysis

Nokia disclosed 37 risk factors in its most recent earnings report. Nokia reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Nokia Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MSI	73 Outperform	$68.81B	34.39	189.18%	1.06%	7.45%	46.78%
HPE	72 Outperform	$24.07B	18.95	6.39%	2.83%	11.63%	-24.41%
JNPR	71 Outperform	$11.98B	34.24	7.58%	2.46%	-2.56%	52.05%
CIEN	70 Outperform	$10.24B	100.60	3.71%	―	2.86%	-29.92%
ERIC	68 Neutral	$28.43B	180.60	1.67%	0.31%	-2.08%	―
NOK	64 Neutral	$28.18B	35.67	5.70%	3.86%	-9.96%	-6.83%
Sector *	62 Neutral	$11.93B	10.60	-7.51%	3.00%	7.40%	-8.09%

* Technology Sector Average

Performance Comparison

NOK

Nokia

5.28

1.65

45.45%

CIEN

Ciena

72.22

23.88

49.40%

JNPR

Juniper Networks

35.90

1.20

3.46%

ERIC

Telefonaktiebolaget LM Ericsson

8.44

2.69

46.78%

MSI

Motorola Solutions

409.07

36.03

9.66%

HPE

Hewlett Packard Enterprise

18.22

-2.95

-13.93%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.