Nokia’s Q3 2025 Profit Beats Expectations, Shares Surge Over 10%
Nokia (NOK) stunned investors on Thursday as its third-quarter earnings surpassed analyst expectations, sparking a more than 10% jump in its stock price on the NYSE. The Finnish telecom giant reported an adjusted operating profit of €435 million (US$505 million), well above the €324 million forecasted by market analysts. This impressive performance was largely fueled by robust demand in its network infrastructure and optical networks divisions.
### Optical Networks Lead Growth
Quarterly group net sales climbed 12% to €4.83 billion, exceeding the forecasted €4.6 billion. Optical Networks led the way with a 19% growth on a constant currency basis, reflecting increasing appetite for high-capacity data infrastructure. Nokia also saw AI and cloud-related sales account for approximately 6% of overall group net revenue, highlighting the company’s strategic pivot toward emerging technologies.
“AI and data center demand continues to be robust. In fact, it continues to accelerate from our perspective,” said CEO Justin Hotard.
### Strong Market Response and Share Performance
Investors responded enthusiastically to the earnings report. Nokia’s shares jumped over 10% to $6.11 by 11:02 AM EDT on Thursday, marking the stock’s highest level in more than three years. In European markets, shares rose 8% to €5.20 in early trading. This surge added roughly $3.5 billion to Nokia’s $34 billion market value.
The company faced several headwinds earlier in the year, including U.S. tariffs, a weaker dollar, and a slowdown in the North American telecom market. Nokia also lost some ground as U.S. carrier AT&T phased out its 5G contract in favor of Ericsson, which secured a $14 billion deal in 2023. Despite these challenges, Nokia’s diversified portfolio in optical networks and AI cloud services helped offset domestic difficulties.
### Expansion into AI and Defense for Future Growth
Looking ahead, Nokia is strategically positioning itself in AI and defense sectors to diversify revenue streams beyond traditional mobile networks. The recent acquisition of U.S.-based Infinera bolsters its capabilities in optical networking and AI-driven data center solutions.
The company slightly raised its annual operating profit guidance to a range of €1.7 billion to €2.2 billion, up from the previous €1.6 billion to €2.1 billion forecast. This revision follows a change in reporting for venture fund results and a decision to scale down passive investments.
Analysts view Nokia’s strong quarterly performance as a clear signal that its investments in emerging technologies are paying off. The focus on AI, cloud, and defense sectors not only offsets challenges in traditional telecom markets but also positions the company for sustainable, long-term growth.
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Stay tuned for more updates on Nokia and the evolving telecom industry.
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