HELSINKI, August 1, 2026, 19:12 EEST
- Nokia ended Friday at €7.958, falling 3.2% over the week. The OMX Helsinki 25 rose 0.3%.
- S&P Global Ratings NYSE:SPGI changed its outlook to positive and maintained Nokia’s BBB- rating.
- Orders for AI and cloud amounted to €2.8 billion, with approximately half expected to turn into revenue in the next twelve months.
Nokia closed the week down 3.2%, capping days of swings, even after a favorable rating update. Cash conversion remains a key challenge.
Orders for AI and cloud totaled €2.8 billion in the quarter, representing 6.3 times the period’s sales to those clients. Approximately 50% is expected to turn into revenue over the next twelve months.
S&P projects 2026 free operating cash flow after leases at €1.1 billion, a decrease of 12%. Nokia anticipates restructuring cash outflows between €700 million and €800 million.
Trading in Helsinki was halted on Saturday. The market is expected to reopen on Monday, August 3.
The regional comparison indicates an evident lag on a weekly basis.
| Instrument | July 24 close | July 31 close | Friday | Week |
|---|---|---|---|---|
| Nokia | €8.222 | €7.958 | up 0.33% | down 3.2% |
| OMX Helsinki 25 | 6,200.36 | 6,220.08 | up 0.28% | up 0.3% |
| Nokia relative performance | — | — | +0.05 pts | -3.5 pts |
Nokia underperformed the index by 3.5 percentage points. Friday’s closing price was 5.9% under its intraday peak. The advance was narrow.
U.S.-listed peers showed significant divergence.
| U.S.-traded security | Friday close | Friday | Week |
|---|---|---|---|
| Nokia ADR NYSE:NOK | $9.14 | up 0.55% | up 0.44% |
| Ericsson NASDAQ:ERIC | $9.81 | up 0.41% | up 5.03% |
| Ciena NYSE:CIEN | $377.05 | up 1.34% | down 3.56% |
Ericsson rose 5.0% over the week. Ciena declined 3.6%. Nokia’s ADR remained mostly unchanged.
Nokia delivered solid operational performance in the second quarter, though reported earnings were lower.
| Metric | Q2 2026 | Q2 2025 | Change or comparison |
|---|---|---|---|
| Net sales | €4.815bn | €4.443bn | Up 8% |
| Comparable operating profit | €434m | €367m | Increased 18% |
| Comparable operating margin | 9.0% | 8.3% | Higher by 70 basis points |
| Reported operating result | -€50m | €147m | Decreased by €197m |
| Comparable profit versus consensus | €434m | €382m estimate | Above by 13.6% |
Comparable operating profit surpassed expectations by 13.6%. However, Nokia still posted a €50 million operating loss. Restructuring accounted for much of the difference.
Nokia forecasts full-year comparable operating profit between €2.1 billion and €2.6 billion. The company described the €100 million rise as technical rather than operational.
Chief Executive Justin Hotard stated: “We expect approximately half of these orders will translate into revenue within the next twelve months.” Nokia Corporation | Nokia
The investor test is evaluated using the order-to-cash comparison.
| Conversion measure | Value | Comparison |
|---|---|---|
| AI and cloud revenue for Q2 | €446m | Base |
| Orders for AI and cloud in Q2 | €2.8bn | 6.3 times sales for Q2 |
| Estimated 12-month revenue conversion | About €1.4bn | 3.1 times Q2 sales |
| Estimated conversion to overall group Q2 sales | About 29% | Group base of €4.815bn |
| Free cash flow, Q2 | -€732m | Actual |
| Anticipated 2026 free-cash-flow conversion | 55%–75% | Company expectation |
| Restructuring cash outflows forecast for 2026 | €700m–€800m | Company expectation |
*Based on management’s guidance of “around half” conversion, these figures are implied estimates.
The implied €1.4 billion represents 29% of the group’s quarterly revenue. However, revenue recognition does not necessarily align with cash flow. That is the key assessment.
The credit comparison clearly shows the size of the gap that still exists.
| S&P measure | Previous or 2025 base | Latest or 2026 forecast | Next hurdle |
|---|---|---|---|
| Rating outlook | Stable | Positive | Upgrade possible |
| Long-term rating | BBB- | BBB- | Increase by one notch |
| Free operating cash flow after leases | €1.25bn | About €1.10bn | Over €1.30bn |
| Potential upgrade timing | — | — | 18–24 months |
S&P’s cash flow requirement exceeds its 2026 projection by 18%. Nokia is given a positive outlook for 18 to 24 months. The BBB- rating is unchanged.
Key risks include supply chain limitations, reduced customer expenditure, success in restructuring efforts, as well as fluctuations in currencies and tariffs. Nokia anticipates its comparable operating profit will stay largely unchanged in the third quarter.
Nokia will pay a €0.04 dividend on Thursday, August 6. The company is expected to report its next earnings on October 22.
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