Sanctum

Mike

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<h3 id="tldr">TLDR</h3>
<ul>
 <li>Rosenblatt Securities launched coverage on Nokia with a Buy recommendation and $15 price objective, highlighting its optical networking division as a critical AI infrastructure investment.</li>
 <li>The company’s Optical Networks division posted 20% year-over-year revenue expansion in Q2 2026, while AI and Cloud revenue more than doubled.</li>
 <li>Total AI and Cloud orders reached €2.8 billion in the second quarter, with approximately 50% projected to translate into revenue over the next year.</li>
 <li>A strategic collaboration between Nokia and Telxius will bring Nokia’s ICE-X 800G coherent pluggable optics technology to terrestrial networks spanning Europe, North America, and Latin America.</li>
 <li>Rosenblatt’s financial model forecasts Nokia’s operating margins will exceed 15% by 2028, compared to 11.5% recorded in 2026.</li>
</ul>
<a href="https://www.investing.com/news/stock-market-news/rosenblatt-starts-nokia-at-buy-on-ai-optical-franchise-potential-4900916" rel="noopener noreferrer nofollow">Rosenblatt</a> launched coverage of Nokia on Monday with a Buy recommendation and $15 price objective, arguing that the Finnish telecommunications equipment provider remains underappreciated for its expanding optical networking operations.
According to analyst Mike Genovese, Nokia’s Network Infrastructure division is “quietly becoming one of the best-positioned optical assets in the AI buildout.” This represents a significant observation considering Nokia continues to command telecom-equipment valuations instead of premium AI infrastructure multiples.
Nokia’s ADR (NOK) was changing hands near $9.65 when this article was published, experiencing a notable decline during the trading session.
<a href="https://knockoutstocks.com/stock/NOK" rel="noopener noreferrer nofollow"> <img src="https://knockoutstocks.com/api/stocks/NOK/embed" alt="NOK Stock Card"> Nokia Oyj, NOK </a>
The company’s Optical Networks division delivered 20% year-over-year revenue growth during Q2 2026. Meanwhile, AI and Cloud revenue experienced growth exceeding 100% during the identical timeframe. Total AI and Cloud orders climbed to €2.8 billion, with approximately half anticipated to generate revenue over the coming 12 months.
The Optical Networks business represents approximately 45% of Nokia’s Network Infrastructure division and roughly 20% of consolidated company revenue. Genovese observed that Nokia’s trailing twelve-month Optical Networks sales of approximately $4 billion position it comparably with Ciena, an acknowledged market leader.
<h3 id="nokia-s-strategic-position-in-ai-data-center-infrastructure">Nokia’s Strategic Position in AI Data Center Infrastructure</h3>
Genovese emphasized Nokia’s strength in “scale-across” networking, characterizing it as the most difficult among three AI data center fabric categories for competitors to penetrate once a vendor achieves design-in status. This type of customer retention becomes critical when evaluating long-term growth prospects.
Rosenblatt projects the overall Optical DCI market, presently valued around $12 billion, could expand at approximately 35% annually to achieve $40 to $50 billion by 2030. The scale-across addressable market segment alone is estimated to surpass $20 billion by 2030, supplementing the current $20 billion DCI foundation.
To strengthen its supply capabilities, <a href="https://knockoutstocks.com/stock/NOK" rel="noopener noreferrer nofollow">Nokia</a> is committing resources to three domestic Indium Phosphide laser manufacturing sites, situated in San Jose, Pennsylvania, and a newly established campus in Chandler, Arizona, obtained via its NXP acquisition.
Rosenblatt’s $15 valuation target derives from a sum-of-the-parts analysis that attributes one-third of Nokia’s worth to AI infrastructure capabilities and two-thirds to its conventional telecom operations. Genovese characterized this allocation as “potentially conservative” considering projections that the business mix will tilt increasingly toward AI applications.
<h3 id="nokia-partners-with-telxius-for-800g-optics-rollout-spanning-multiple-regions">Nokia Partners with Telxius for 800G Optics Rollout Spanning Multiple Regions</h3>
In separate news, Nokia revealed a collaboration with Telxius to implement its ICE-X 800G coherent pluggable optics solution throughout Telxius’ terrestrial transport infrastructure in Europe, North America, and Latin America.
This implementation leverages IP-over-DWDM technology to accommodate escalating requirements from cloud platforms, AI computational loads, and data center interconnection needs. Nokia’s automation capabilities provide Telxius with comprehensive network visibility and performance tracking.
The collaboration extends a recent joint demonstration conducted over Telxius’ BRUSA subsea cable system, where Nokia’s 800G ZR+ solution achieved 400 Gb/s per wavelength across distances exceeding 5,600 kilometers.
Regarding Nokia’s remaining business units, Genovese characterized Fixed Networks and Mobile Infrastructure as low-single-digit growth operations being optimized for margin enhancement, supported by AI-RAN deployment and expense reduction initiatives including reduced exposure to China markets. Rosenblatt’s financial projections indicate operating margins climbing above 15% by 2028, representing an increase from the 11.5% level recorded in 2026.
The post <a href="https://blockonomi.com/analyst-initiates-nokia-nok-stock-with-buy-rating-on-surging-ai-optical-network-growth/" rel="noopener noreferrer nofollow">Analyst Initiates Nokia (NOK) Stock with Buy Rating on Surging AI Optical Network Growth</a> appeared first on <a href="https://blockonomi.com" rel="noopener noreferrer nofollow">Blockonomi</a>.

Analyst Initiates Nokia (NOK) Stock with Buy Rating on Surging AI Optical Network Growth

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