NOK

A month has gone by since the last earnings report for ViaSat (VSAT). Shares have lost about 13.7% in that time frame, underperforming the S&P 500. Will the recent negative trend continue leading up to its next earnings release, or is ViaSat due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for Viasat Inc. before we dive into how investors and analysts have reacted as of late. Viasat Q1 Earnings Beat Estimates Despite Lower Y/Y Revenues Viasat reported mixed first-quarter fiscal 2027 results, with revenues missing the Zacks Consensus Estimate and earnings beating the consensus estimate. The company reported a year-over-year revenue decline, reflecting ongoing headwinds in portions of its legacy commercial services portfolio and lower IP licensing revenues. However, its bottom line improved as reduced interest expense, driven by continued debt repayment, outweighed the impact of lower revenues. Net IncomeViasat reported a net loss of $51.7 million or a loss of 38 cents per share compared with a net loss of $56.4 million or a loss of 43 cents per share in the prior-year quarter. The narrower loss was due to lower interest expense during the quarter. Excluding non-recurring items, Viasat reported non-GAAP net income of $24.5 million or 17 cents per share compared with $23.1 million or 17 cents per share in the prior-year period. The bottom line beat the Zacks Consensus Estimate of 10 cents.RevenuesRevenues declined to $1.16 billion from $1.17 billion. The figure missed the consensus estimate of $1.2 billion. Product revenues were $324.1 million, down from $344.7 million in the year-ago quarter. Service revenues increased to $832.4 million from $826.4 million a year ago.Revenues from the Communication Services segment were $825.1 million, down from $827.4 million in the prior-year quarter. The marginal revenue decline reflected lower contributions from residential fixed broadband and maritime services, which offset continued growth in aviation and government Satellite Communications. The segment’s adjusted EBITDA decreased to $311.3 million from $321.5 million.Revenues from the Defense and Advanced Technologies (DAT) segment were $331.5 million, down 4% year over year, primarily due to weaker contributions from Advanced Technologies & Other and Space and Mission Systems, despite strong Tactical Networking growth. Adjusted EBITDA decreased to $69.9 million from $86.9 million in the year-ago quarter.Other DetailsIn the June quarter, Viasat reported an operating income of $47.3 million compared with $46.7 million in the prior-year quarter. Adjusted EBITDA was $381.1 million, down from $408.5 million in the year-ago quarter. The net contract awards increased to $1.3 billion from $1.18 billion a year ago, while the backlog increased 19% year over year to $4.22 billion.Cash Flow & LiquidityDuring the first quarter of fiscal 2027, Viasat generated an operating cash flow of $260.6 million compared with $258.5 million in the prior-year period. As of June 30, 2026, the company had $1.74 billion in cash and cash equivalents, with a net debt of $4.83 billion.OutlookFor fiscal 2027, management expects mid-single-digit revenue growth and flat to slightly up adjusted EBITDA year over year. Viasat anticipates the Communication Services segment’s low single-digit year-over-year revenue performance, due to continued growth in aviation services, offset by a decline in FS&O. DAT revenue growth is anticipated to be in the mid-teens, primarily driven by strong growth in information security and cyber defense, as well as space and mission systems and tactical networking. Capital expenditure is expected to be between $950 million and $1 billion (including approximately $250-$300 million for Inmarsat-related capital expenditures). The company’s operating cash flow is expected to be flat year over year, and the free cash flow is anticipated to be approximately $180 million (excluding the benefit of the Ligado lump sum payments, as they are non-recurring). It turns out, estimates revision have trended downward during the past month. The consensus estimate has shifted -13.33% due to these changes. Currently, ViaSat has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock has a score of A on the value side, putting it in the top 20% for value investors. Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, ViaSat has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. ViaSat is part of the Zacks Wireless Equipment industry. Over the past month, Nokia (NOK), a stock from the same industry, has gained 2.7%. The company reported its results for the quarter ended June 2026 more than a month ago. Nokia reported revenues of $5.6 billion in the last reported quarter, representing a year-over-year change of +8.5%. EPS of $0.08 for the same period compares with $0.05 a year ago. Nokia is expected to post earnings of $0.08 per share for the current quarter, representing a year-over-year change of +14.3%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged. The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Nokia. Also, the stock has a VGM Score of D. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Viasat Inc. (VSAT) : Free Stock Analysis Report Nokia Corporation (NOK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Ciena Corporation CIEN will report third-quarter fiscal 2026 results on Sept. 3, before market open. The Zacks Consensus Estimate for earnings for the to-be-reported quarter is pegged at $1.73 per share, indicating growth of 158.2% from the year-ago reported figure. Analysts have revised their estimates marginally upward for CIEN’s bottom line over the past 60 days. Image Source: Zacks Investment Research The consensus estimate for total revenues is pinned at $1.64 billion, implying an increase of 34.6% year over year. For the fiscal third quarter, management expects revenues of $1.625 billion (+/- $50 million). Our proven model predicts an earnings beat for CIEN this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. That is the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter. CIEN has an Earnings ESP of +0.58% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Ciena continues to benefit from robust demand for high-speed connectivity solutions, supported by growing network requirements associated with AI. In the second quarter of fiscal 2026, the company reported record revenues of $1.57 billion, up 40% year over year. On the last earnings call, management highlighted strong demand from cloud providers, hyperscalers and service providers as customers increasingly prioritize high-capacity, low-latency and high-speed connectivity to support AI model training, data ingestion and inference. The company also noted that leading hyperscalers have increased their 2026 capital expenditure plans, with indications of continued expansion into 2027 and beyond, while service providers are reinvesting in network infrastructure after several years of relatively muted spending. Strong demand across Ciena’s Optical Networking and Routing and Switching businesses is another important factor. Optical Networking revenues increased 42% year over year in the fiscal second quarter, driven by strong demand for the RLS and Waveserver product lines, both of which grew more than 55%. Routing and Switching revenues increased 88%, primarily reflecting the continued ramp of Ciena’s data center out-of-band management, or DCOM, solution. Direct cloud customer revenues increased 70% year over year, while service provider revenues grew 28%. India service provider revenues more than doubled year over year, reflecting strong demand for managed optical fiber network, or MOFN, deployments. Ciena is also witnessing continued momentum across its data center and interconnect portfolio. DCOM continues to ramp, with initial orders received from a second hyperscaler customer and lab qualifications progressing with a third hyperscaler. Ciena continues to see strong hyperscaler demand for its 400-gig and 800-gig pluggables and remains on track to more than double pluggable revenues from fiscal 2025 levels. The company also secured its first win with a major switch OEM for its WaveLogic 5 and 6 Nano pluggables. Ciena Corporation price-consensus-eps-surprise-chart | Ciena Corporation Quote The company’s strong backlog also provides substantial visibility. Ciena ended the fiscal second quarter with a backlog of $7.7 billion, up more than $600 million sequentially, and management expects backlog to increase further through the remainder of fiscal 2026. Robust order flows, customer collaboration, a growing services business and the company’s backlog are providing strong visibility into fiscal 2027. Of the $7.7 billion backlog, approximately $6.4 billion represents hardware, with about 80% of that amount expected to be delivered over the following 12 months. On the last earnings call, management also stated that customers would take additional products in fiscal 2026 if Ciena were able to deliver them and that the company is not seeing order cancellations, delivery pushouts or inventory accumulation at customers. Ciena’s margin performance also remains an important factor. Adjusted gross margin reached 44.9% in the fiscal second quarter, driven by engineering cost reductions, product mix and price optimization. Management continues to focus on engineering-driven cost reductions, supply-chain optimization and value-exchange opportunities with customers, including pricing opportunities across the product portfolio. For the fiscal third quarter, Ciena expects revenues of  $1.625 billion, plus or minus $50 million. Adjusted gross margin is expected to be 45%, plus or minus 50 basis points, while adjusted operating expenses are projected at  $410 million, plus or minus $10 million. Adjusted operating margin is anticipated to be between 19% and 20%. However, supply continues to lag demand across the industry. On the last earnings call, management stated that Ciena continues to operate in a supply-constrained environment and is working with suppliers and customers to secure additional capacity to support its growing backlog. The company is experiencing constraints in certain modem components, including CDMs, as well as pump lasers used in amplifiers and line systems. Ciena is making additional investments with suppliers to secure long-term supply and manufacturing capacity and remains on track to spend $250-$275 million in capital expenditures during fiscal 2026. Management also continues to monitor inflationary pressures and product mix while using engineering cost reductions and supply-chain initiatives to mitigate higher input costs. These might have negatively impacted the company’s third-quarter performance. Stiff competition from Cisco Systems, Inc. CSCO, Nokia NOK and Arista Networks, Inc. ANET remains a concern. Ciena shares have risen 325.5% over the past year, outperforming the  Zacks Computer & Technology sector and the Zacks Communication - Components industry’s growth of 31.9% and 198.8%, respectively. The S&P 500 Composite has returned 23.1% over the same time frame. Image Source: Zacks Investment Research Shares of the company’s peers CSCO, NOK and ANET have surged 65.6%, 149.4% and 47.2%, respectively, in the same period. In terms of Price/Book, CIEN shares are trading at 19.57X, higher than the Communication - Components industry’s 10.67X, indicating more risk than opportunity. Image Source: Zacks Investment Research In comparison, CSCO, NOK and ANET trade at multiples of 8.79X, 2.46X and 17.14X, respectively. Ciena’s strong AI-driven demand, expanding cloud opportunities, robust backlog and positive Earnings ESP bode well ahead of fiscal third-quarter earnings. However, persistent supply constraints and premium valuation remain a concern. New investors may be better off waiting for a more attractive entry point before initiating a position. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ciena Corporation (CIEN) : Free Stock Analysis Report Nokia Corporation (NOK) : Free Stock Analysis Report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Coherent and Cisco beat estimates yet sold off sharply after Coherent's operating cash flow cratered 87% and Cisco's gross margin compressed to 66%. Ciena jumped 6% and Nokia gained 3% as those same earnings calls confirmed explosive data center interconnect demand, lifting pure-play optical vendors instead. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Cisco Systems didn't make the cut. Grab the names FREE today. The optics complex is splitting in two this morning. Coherent (NYSE:COHR) is trading down 4.94% and Cisco Systems (NASDAQ:CSCO) is down 8.48% after both reported fiscal fourth-quarter results last night. Yet the pure-play optical vendors that sell into the exact same demand story are green. Ciena (NYSE:CIEN) is up 6.04% and Nokia (NYSE:NOK) is up 3.29%. Both earnings were beats. Coherent posted revenue of $2.05 billion, up 33.74% year over year, and non-GAAP EPS of $1.74 against a $1.612consensus. The Datacenter and Communications segment hit $1.615 billion, up 59% year over year on a pro forma basis. The sore spot is the 8-K cash disclosure: fiscal 2026 operating cash flow of $79.5 million, down 87.45% year over year, against capital expenditures of $1.1029 billion, up 150.18%. Coming into the earnings report, COHR had already rallied 8.35% over the prior week, which included a steep sell-off on Monday and gains last week following reports of potential U.S. bans on Chinese transceiver shipments. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Cisco Systems didn't make the cut. Grab the names FREE today. Cisco reported $17.25 billion in revenue, up 17.6% year over year, with $4.0 billion of AI infrastructure orders in the quarter and $9.3 billion for fiscal 2026. FY2027 guidance calls for revenue of $72.2 billion to $73.4 billion and $7.5 billion in AI infrastructure revenue. The issue is margin mix. Non-GAAP gross margin dropped to 66.3% from 68.4% on heavier AI hardware volume and memory cost inflation. CEO Chuck Robbins called it "a very strong close to fiscal 2026, marking another record year for Cisco," but the stock is trading as if expectations were priced for perfection. The read-through is that data center interconnect and coherent optical transport demand is inflecting hard. On Lumentum's conference call earlier this week CEO Michael Hurlston said: "Expanding, inferencing and training applications are driving full rate connectivity between data centers, while political and regulatory constraints favor smaller, more modular builds. These 2 factors among others are substantially increasing the demand for our pump laser solutions. To put this in perspective, for one major hyperscaler, the network capacity connecting just 2 AI data center sites could double the total global backbone capacity they built over the entirety of the last decade. To support the growth and scale across deployments, we have secured multiple long-term customer agreements that helped offset our planned capital expenditures. We continue to expect a fourfold increase in our pump laser shipments over the next several quarters to meet this escalating demand." That quote is music to the ears of companies like Nokia and Ciena. In addition, Coherent CEO James Anderson said on last night's call that "The demand just continues to go up for anything DCI or scale across related."Cisco said their Acacia optics unit had another $1 billion quarter that was "very strong." That is exactly the addressable market Ciena and Nokia sell into. Ciena's most recent quarter showed 39.51% revenue growth with cloud provider revenue at 46% of total, growing 70% year over year. Nokia's Q2 AI and Cloud revenue more than doubled year over year with $3.2 billion in AI and Cloud order intake. Nokia trades as a US-listed ADR. Another catalyst for this group appears to be Wall Street commentary. Last night JPMorgan issued a note taht the strongest parts of Cisco's earnings had positive read-through for Nokia as the company reported surprisingly strong telecom orders. That's also positive read-through for Ciena itself. The two that reported are down. The transport and interconnect vendors around them are up. Coherent still has heavy analyst backing, with a consensus target of $394.62 against today's $340.04 print. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Cisco Systems didn't make the cut. Grab the names FREE today. Contact [email protected] for any questions or corrections.

Interested in Inseego? Here are five stocks we like better. Q2 revenue beat expectations: Inseego reported $44 million in revenue, up 28% sequentially and 9% year over year, helped by strong product sales and $5 million–$6 million in early carrier purchases ahead of expected memory-cost increases. Full-year outlook was lowered: The company now expects approximately $155 million in 2026 revenue, citing product-development delays, slower recovery from a major fixed wireless access customer, reduced services revenue and the removal of anticipated MSO revenue. Nokia FWA acquisition remains targeted for Q4 2026: Inseego expects the transaction to more than double its revenue base and add global customer relationships, engineering capabilities and a broader fixed wireless access product portfolio. 3 Defense Stocks Under $20 With Massive Upside Inseego (NASDAQ:INSG) reported second-quarter 2026 revenue of $44 million, exceeding the high end of its guidance range and rising 28% sequentially and 9% from a year earlier. The company said product revenue and late-quarter carrier orders helped drive the result, though those orders also pressured gross margin and are expected to reduce ordering levels in the third quarter. Chief Executive Officer Juho Sarvikas said the company benefited from purchases by select carrier customers seeking to get ahead of anticipated memory-cost increases in the second half of the year. Chief Financial Officer Steven Gatoff estimated that roughly $5 million to $6 million of incremental revenue was recognized in the second quarter from the ordering activity. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control However, Inseego reduced its full-year outlook, citing earlier product delays, a slower-than-expected recovery at its largest fixed wireless access customer, lower anticipated software-services revenue and the removal of multichannel video programming operator, or MSO, revenue from its 2026 forecast. Product revenue totaled $31.7 million, or 72% of total revenue, up 12% year over year. Mobile solutions revenue increased 26% from a year earlier to $17.3 million, supported by activity with a newer tier-one carrier customer and channel demand for the refreshed MiFi portfolio. Fixed wireless access revenue was $14.4 million, including a large purchase from the newest tier-one carrier customer. → 3 Drone Stocks That Should Soar After the Summer Slump Services and other revenue was $12.3 million, representing 28% of total revenue and a 2% year-over-year increase. Sarvikas said Inseego completed the launch of its refreshed MiFi PRO M4 mobile-product family across all three North American tier-one carrier customers. The company also made a multi-carrier model available through the value-added reseller channel. Inseego now has six products across three tier-one carriers, according to Sarvikas. → The Bitcoin Comeback May Already Be Underway—2 ETFs for Exposure The company also supported a large industrial deployment using its IoT product with Inseego Connect, its cloud-based device-management platform. Non-GAAP gross margin was 34% in the second quarter. Gatoff said the larger carrier deal carried a fixed selling price, while Inseego used higher-cost memory purchased for subsequent orders to fulfill part of the increased volume. The company expects product margin percentage to improve to the high teens in the third quarter as lower-margin products decline and memory-cost increases are passed through to customers. Non-GAAP operating expenses were $16.9 million, flat sequentially and equal to 38% of revenue. Adjusted EBITDA was $0.5 million, representing a 1% margin and in line with guidance. Inseego ended June with approximately $2 million of cash and $10 million outstanding on its revolver. Gatoff said the cash balance reflected the timing of significant product deals that closed late in the quarter, increasing accounts receivable. The company has collected material amounts of those receivables in the third quarter and has meaningfully paid down the revolver, he said. Inseego now expects approximately $155 million in standalone revenue for full-year 2026. For the third quarter, it forecast revenue of $28 million to $35 million and adjusted EBITDA of negative $1 million to negative $2 million. Sarvikas said product-development processes did not support the faster pace of product introductions undertaken over the past 18 months. The company historically introduced roughly one new product annually, but has recently launched multiple products and variants across mobile and fixed wireless access while expanding its customer base. “The development process that we used as a company was not capable of parallel processing the complexity introduced by a broader customer base and a broader set of products,” Sarvikas said during the question-and-answer session. The company said it has overhauled its development process and milestone model, narrowed its near-term product-introduction cadence and is searching for a new engineering leader. Sarvikas said several candidates are engaged in the process. Inseego also cited the slower recovery of an existing large FWA carrier customer, which is working through changes to its enterprise go-to-market strategy and internal organization. Management said a next-generation FWA product is expected to help restore that customer’s ordering run rate, although the recovery is taking longer than anticipated. In addition, Inseego removed MSO revenue from its 2026 outlook because customer conversion has taken longer than expected. Gatoff said the opportunity had previously been considered in the range of $15 million to $20 million. Beginning in the third quarter, the company expects software services and other revenue to decline by about $2 million per quarter as a tier-one carrier customer requires less complex professional-services work related to the Inseego Subscribe platform. Gatoff clarified that the reduction is expected to be a one-time step down, rather than a recurring $2 million quarterly decline. He said the customer continues to use the SaaS platform and that the parties are discussing the terms of a renewed agreement. Inseego continues to target a fourth-quarter 2026 closing for its acquisition of Nokia’s FWA business, subject to customary closing conditions. The company said the acquired business has an annual revenue run rate of approximately $200 million and would more than double Inseego’s revenue base. Management said the transaction is expected to add engineering capabilities, global tier-one customer relationships and a broader FWA portfolio that includes indoor, outdoor and millimeter-wave products. Sarvikas said the acquired Nokia research-and-development function will remain intact at closing. To prepare for integration, Inseego appointed Pranav Shroff to lead APAC sales, Ossi Korpela to lead EMEA sales and expanded Steve Harmon’s role to lead the Americas, including Latin America. The company selected Amsterdam as its center of international operations and is building Athens as a software-development center for its global FWA portfolio. Gatoff said Inseego expects to provide separate fourth-quarter revenue guidance for its standalone business and the acquired Nokia FWA business on its third-quarter earnings call, assuming the transaction closes as planned. Beginning with its fourth-quarter 2026 results call, expected in February 2027, the company intends to report and provide guidance as a combined company. Inseego Corp is a U.S.-based technology company specializing in 5G and intelligent Internet of Things (IoT) device-to-cloud solutions. The company develops hardware and software platforms designed to connect devices, vehicles and remote locations to high-speed wireless networks. Its core offerings include mobile hotspots, fixed wireless access gateways and ruggedized routers optimized for enterprise, industrial and government applications. Inseego's product portfolio encompasses 5G MiFi® mobile hotspots, virtual network functions (VNFs) for network management, telematics devices for fleet tracking and asset monitoring, as well as a suite of cloud-native software for device lifecycle management and data analytics. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Inseego Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Make better investment decisions with Simply Wall St's easy, visual tools that give you a competitive edge. Nokia Oyj (HLSE:NOKIA) stock is back in focus after the company reported second quarter 2026 results and issued third quarter guidance that assumes a 3% to 7% quarter on quarter rise in net sales. See our latest analysis for Nokia Oyj. At a share price of €8.10, Nokia Oyj has seen the 30 day share price return fall 27.48% and the 90 day share price return fall 28.60%. However, the year to date share price return is 46.63% and the 1 year total shareholder return is 134.96%, which suggests that recent volatility around earnings and guidance has followed a period of strong performance. If Nokia's latest update has you thinking about where else growth or recovery stories might emerge, it could be worth scanning 55 AI infrastructure stocks The sharp pullback in Nokia Oyj after its latest results sits against a much stronger 1 year return. That raises a simple question. Are you looking at a reset in expectations or a rare opening in the valuation? The most followed narrative on Nokia Oyj places fair value at €15.16, which sits well above the recent €8.10 share price. That gap is grounded in a detailed view of cash flows, margins and growth rather than short term trading swings. Read the complete narrative. Want to see what bridges €8.10 to €15.16? According to TheTurntTomato, the narrative leans heavily on accelerating revenue, improving margins and a premium future earnings multiple. Curious which assumptions do the heavy lifting and how sensitive that fair value is to small changes in growth and profitability? Result: Fair Value of €15.16 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, Nokia Oyj still faces risks, including pressure on telecom spending and execution challenges in scaling AI and defense offerings, which could unsettle this undervalued narrative. Find out about the key risks to this Nokia Oyj narrative. The SWS DCF model values Nokia Oyj at €11.66 per share, which is above the current €8.10 price and points to the stock trading at a discount. That supports the user narrative, but uses future cash flows rather than a premium earnings multiple as the basis for valuation. Which lens do you trust more? Look into how the SWS DCF model arrives at its fair value. With Nokia Oyj’s mix of risks and rewards in focus, it makes sense to move quickly and check the full picture for yourself. To weigh both sides and see what stands out most for your own thesis, start by reviewing the 2 key rewards and 3 important warning signs If Nokia Oyj has sharpened your thinking, do not stop here. Use the Simply Wall Street Screener to quickly surface fresh opportunities that fit your own criteria. Target potential bargains by scanning companies that combine quality with attractive pricing through the 253 high quality undervalued stocks. Strengthen your watchlist with businesses that carry resilient finances by reviewing the solid balance sheet and fundamentals stocks screener (414 results). Hunt for underfollowed opportunities that still show robust fundamentals using the screener containing 544 high quality undiscovered gems. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include NOKIA.HE. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Ericsson ERIC delivered a mixed set of second-quarter results, demonstrating resilient profitability despite weaker revenue performance. While softer operator spending and lower licensing revenue weighed on sales, disciplined execution and continued cost management helped the company maintain healthy margins. The latest results provide investors with a clearer picture of Ericsson's near-term challenges and long-term opportunities. Ericsson's earnings highlighted the effectiveness of its ongoing efficiency initiatives. The company reported an adjusted gross margin of 48.4%, slightly higher than the year-ago level of 48%, supported by disciplined operational execution and improved profitability within its Mobile Networks business. Cost-reduction measures, pricing actions to offset component inflation, and continued operational efficiency also helped protect earnings despite softer revenues. Cloud Software and Services delivered improved adjusted margins, further supporting overall profitability. Image Source: Zacks Investment Research Revenue trends remained challenging during the quarter. Reported sales declined 6% year over year to SEK 52.7 billion, while organic sales slipped 1%, primarily because of lower IPR licensing revenue following a non-recurring licensing settlement recorded last year. Demand also remained uneven across geographic markets as wireless carriers continued to moderate network investment, limiting equipment sales despite pockets of regional growth. Image Source: Zacks Investment Research One encouraging development was the continued momentum in Cloud Software and Services. The segment delivered 5% organic sales growth and improved adjusted profitability, benefiting from ongoing 5G core network upgrades and software deployments. Alongside Cisco Systems CSCO and Nokia NOK, Ericsson continues investing in AI-enabled networking, enterprise connectivity and automation technologies that could diversify its revenue base beyond traditional mobile infrastructure over time. Management expects network activity to remain supported by seasonal rollout projects but also cautioned that higher volumes of deployment work could pressure Networks gross margins in the third quarter. Ericsson plans to continue pricing actions and internal cost initiatives to offset component inflation while maintaining investments in AI-driven connectivity. At the same time, restructuring efforts, cautious carrier spending and ongoing macroeconomic uncertainty remain important factors that could influence results in coming quarters. The stock currently carries a Zacks Rank #3 (Hold), reflecting a balanced view of Ericsson's investment outlook. While its attractive Value Score highlights reasonable valuation, weaker Growth characteristics and average Momentum indicate that revenue recovery remains a key watchpoint. Taken together, the current Zacks Rank and Style Scores suggest the earnings report demonstrates solid operational execution, but investors may still prefer to see stronger top-line growth before becoming more constructive on the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ericsson (ERIC) : Free Stock Analysis Report Nokia Corporation (NOK) : Free Stock Analysis Report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

InterDigital, Inc. IDCC has strengthened its investment case with another quarter of better-than-expected financial results, rising recurring revenue and higher full-year guidance. At the same time, investors must weigh those positives against a premium valuation and the inherent volatility of a licensing-driven business.The company's expanding presence in streaming, cloud services and Internet of Things (IoT) markets also suggests its long-term growth story extends well beyond traditional smartphone licensing. InterDigital delivered a strong second quarter, reporting revenue of $260.2 million and non-GAAP earnings per share of $4.62, both comfortably ahead of expectations. Although reported revenue declined year over year due to licensing timing, the quarter reflected solid operating execution. Management also raised its full-year 2026 revenue outlook to a range of $775 million to $845 million, increasing the midpoint by $85 million. InterDigital, Inc. price-consensus-eps-surprise-chart | InterDigital, Inc. Quote Another encouraging indicator was recurring revenue. Annualized recurring revenue reached a record $626 million, up 13% from a year earlier, demonstrating continued progress toward building a more predictable licensing business. The combination of stronger recurring revenue and higher guidance reinforces confidence in the company's operating momentum despite quarter-to-quarter fluctuations in reported licensing revenue. InterDigital continues to diversify its licensing base beyond smartphones. Recent agreements with Amazon covering devices and services, including Prime Video, along with new IoT licensing agreements involving a leading fintech company and KEBA, expand the company's recurring royalty opportunities across cloud services, streaming and connected devices. The company also benefits from healthy cash generation and a strong balance sheet. At June 30, 2026, InterDigital held more than $1.1 billion in cash and short-term investments, providing ample financial flexibility to fund research, pursue intellectual property development, support shareholder returns and continue patent enforcement activities. Companies such as QUALCOMM Incorporated QCOM and Nokia Corporation NOK also rely on intellectual property licensing to generate recurring revenue, highlighting the value of diversified patent portfolios in the communications technology industry. Despite favorable business trends, several risks could temper future returns. Customer concentration remains significant, making results sensitive to negotiations with a relatively small number of major licensees. Revenue can also fluctuate depending on the timing of licensing renewals, new agreements and arbitration outcomes.In addition, intellectual property enforcement requires ongoing legal spending, while maintaining leadership in wireless, video and artificial intelligence technologies demands continued research investment. Because large licensing agreements may not occur evenly from quarter to quarter, earnings volatility is likely to remain a characteristic of the business model. The investment case now rests on balancing premium valuation against improving fundamentals. According to the latest research report, the shares trade at approximately 25.6 times trailing earnings and 9.9 times trailing sales. The report also carries a 6–12-month price target of $348.83, reflecting expectations that expanding recurring licensing revenue and continued execution could support additional earnings growth over time. Investors should recognize, however, that premium valuation multiples leave less room for operational missteps. Continued execution on recurring revenue growth, licensing expansion and management's updated outlook will likely remain important factors supporting the company's longer-term valuation. Overall, InterDigital presents a favorable combination of improving operating performance, expanding licensing opportunities and strong financial resources, although investors should remain mindful of the risks associated with a licensing-focused business model.The stock currently sports a Zacks Rank #1 (Strong Buy), reflecting positive earnings estimate momentum and a favorable near-term outlook. You can see the complete list of today’s Zacks #1 Rank stocks here. At the same time, its Value Score of D, Growth Score of C, Momentum Score of F and VGM Score of F indicate that valuation and recent share-price characteristics are less compelling than its earnings outlook. Together, these measures suggest investors should evaluate the company's strong business fundamentals alongside its valuation and momentum profile when assessing the stock. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report InterDigital, Inc. (IDCC) : Free Stock Analysis Report QUALCOMM Incorporated (QCOM) : Free Stock Analysis Report Nokia Corporation (NOK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, July 23, 2026 at 8 a.m. ET President and Chief Executive Officer - Justin Hotard Executive Vice President and Chief Financial Officer - Marco Wiren Head of Investor Relations - David Mulholland David Mulholland: Good morning, ladies and gentlemen. Welcome to Nokia's Second Quarter 2026 Results Call. I'm David Mulholland, Head of Nokia Investor Relations. And today with me is Justin Hotard, our President and CEO; along with Marco Wiren, our CFO. Before we get started, a quick disclaimer. During this call, we will be making forward-looking statements regarding our future business and financial performance, and these statements are predictions that involve risks and uncertainties. Actual results could, therefore, differ materially from the results we currently expect. Factors that could cause such differences can be both external as well as internal operating factors. We have identified such risks in the Risk Factors section of our annual report on Form 20-F, which is available on our Investor Relations website. Within today's presentation, references to growth rates will be on a constant currency basis and other financial items will be based on our comparable reporting. Please note that our Q2 report and a presentation that accompanies this call are published on our website. The report includes both reported and comparable financial results and reconciliation between the two. In terms of the agenda for today, Justin will go through the strategic highlights of the quarter and then Marco will go through our financial performance. We'll then move to Q&A. With that, let me hand over to Justin. Justin Hotard: Thanks, David, and hello, everyone. Our second quarter showed continued progress against the strategy we set at our Capital Markets Day. Our team is focused on maximizing our opportunity in the AI super cycle, and that focus is translating into early results. I'm pleased with the progress that team Nokia has made in the first half of 2026. In Q2, net sales grew 9%. We expanded our gross margin by 70 basis points to 46% and our operating margin by 70 basis points to 9%. Network infrastructure delivered strong growth led by optical and IP networks with sales from AI and cloud customers more than doubling year-on-year. Mobile infrastructure sales also grew, and the business delivered stable profitability, largely driven by product mix. Marco will take you through the details of our financial performance in his update in a moment. I want to take a step back and look at how our first half performance demonstrates progress against the strategy we set out in last November. As a reminder, these are the five priorities we shared at our Capital Markets Day, and I'm pleased by the progress we've already made across each of these areas. Let me touch on a few highlights from Q2. AI and cloud was the strongest growth driver in the quarter. Net sales more than doubled year-on-year to EUR 446 million and order intake grew to EUR 2.8 billion. While we're very pleased with the order growth, it's important to put that number into a bit of context. Q2 benefited from several significant long-term orders as our customers look to secure supply in a constrained environment. To provide some reference, approximately half the order volume received in Q2 is expected to convert to revenue in the next 12 months. As I've said before, order patterns in this market can be lumpy and we should not expect this level of intake every quarter. As importantly, the strength was broad-based across optical networks and IP networks and included some of the design wins we mentioned last quarter. This was driven by growing demand for data center interconnect and scale across fabrics from our customer base. The demand primarily shows up in our AI and cloud segment, but we're also seeing emerging signs of growth in telecom customers as they invest to support the increased data traffic driven by the AR super cycle. During this quarter, we also secured our first multi-rail ILA design win with a major customer. This is one of the new optical networking products we launched at OFC this past March. Last week, we launched the industry's first commercial AI RAN platform, marking a fundamental shift from a hardware-defined radio network to software-defined platforms. This fundamentally changes the economics of radio networks. Our AI RAN platform gives our telco customers a path to improved network performance through software and AI innovation rather than relying on hardware upgrades as they have traditionally. The platform would deliver more than 100% spectral efficiency gains by 2028, doubling the capacity operators can get from their existing spectrum. The performance benefits are tangible in 5G networks, and our AI RAN platform provides a software upgrade path to 6G to ensure continuity without additional hardware investment. The platform is also open, programmable and ORAN compliant. This gives operators greater flexibility as they evolve their networks. They can choose the hardware path that works best for them, adding AI acceleration into their existing Nokia AirScale infrastructure, deploying new AI RAN hardware or moving to cloud native AI RAN. Ultimately, this is about delivering more performance, better returns and faster delivery of new service for our customers. We're on track to enter pilot deployments at the end of this year and expect to be commercially available in 2027, as we've said previously. Co-innovation is a powerful differentiator for Nokia. When we combine our technology leadership with the expertise and scale of our customers and partners, we accelerate innovation, bring solutions to market faster and solve increasingly complex challenges together. We're already demonstrating early results from this approach, and I will highlight four examples from Q2. First, we expanded our partnership with Google Cloud, bringing Gemini-powered AI agents into our autonomous networks portfolio. Second, with Vodafone Albania, we demonstrated AI-powered network slicing using agents to dynamically optimize network resources. Third, we expanded our relationship with Indosat or Hutchinson in Indonesia, supporting network monetization and the rollout of 5G, while providing a seamless upgrade path to AI RAN. And fourth, we entered trials with a U.S. hyperscaler for a new out-of-band management solution that goes inside the data center, leveraging the passive optical technology that we deliver in our fixed networks business. We're also making progress to focus Nokia where we can differentiate and create long-term value. This means we are investing where we see long-term demand and we believe Nokia can be a unique winner and at the same time, reducing exposure to areas where we are less differentiated. In November, we shared that our fixed wireless access customer premise equipment portfolio is not core to the future of our strategy. The sale we announced this past quarter to Inseego is an example of our disciplined approach to capital allocation and allows us to concentrate resources on higher priority opportunities. The sale is on track to close by the end of the year. Talking about higher priority opportunities, one area of focused investment is scaling the capacity needed to support our optical growth ambitions, particularly around indium phosphide semiconductor manufacturing. In San Jose, our new indium phosphide fab is now processing test waivers as we move closer to product qualification. It remains on track for volume production by the end of the year. In June, we announced a new commitment we are making to scale our Pennsylvania facility, increasing our advanced test and packaging capacity for optical systems in that facility by 10 times. In addition, today, we announced the acquisition of a manufacturing site from NXP in Arizona, where we plan to increase our indium phosphide fab capacity. This gives us additional capacity to support our own demand and greater optionality, recognizing the supply constraints in the market today. Altogether, these investments continue to strengthen and secure U.S.-based optical manufacturing capacity for the long term. While Marco will update you on our restructuring progress, I wanted to touch on one key area where we are making progress in driving incremental productivity. We believe that to be a relevant technology provider in the AI super cycle, we need to be a leading adopter of AI internally. Last year, we established a team to deploy AI test beds across multiple functions within Nokia. One area where we're seeing early traction is software development where we now have nearly 100% adoption across our developer base. This is already yielding significant productivity returns, supporting our efficiency targets and accelerating road map deliverables. We will continue to scale this initiative across every function of the organization as our test beds yield tangible results. We see this as essential not only to unlock sustainable returns, but also to be a better partner in support of our customers as we help them unlock the full potential of the AI super cycle. So in closing, I want to recognize and thank team Nokia for a strong first half of the year. We are focused on our key priorities and have begun to fundamentally change how we work. I'm pleased to see our efforts are already reflected in our results. We're entering the second half with good momentum and remain on track to deliver somewhat above the midpoint of our operating profit guidance. And now I will turn the call over to Marco to dive into our financial performance. Marco Wiren: Thank you, Justin, and hello from my side as well. Before looking at the quarterly performance, let me start with reporting changes we announced this morning. As we have agreed to sell our fixed wireless access business to Inseego, we now consider the sale of enterprise campus edge highly probable. As a result, both businesses are classified as discontinued operations. We have published recast historical numbers for 2025 and quarter 1, 2026, to support comparability. In quarter 2 2026, this reporting change reduced comparable net sales by EUR 66 million and increased the comparable operating profit by EUR 13 million. It also led to minor adjustments in cost allocations between network infrastructure and mobile infrastructure with an impact of approximately EUR 1 million to EUR 2 million per quarter. Turning to performance. Net sales grew 9% in the quarter, supported mainly by network infrastructure. First profit was EUR 2.2 billion, and gross margin increased 70 basis points to 46%. The margin expansion was driven by network infrastructure and particularly optical networks, where we continue to benefit from both strong demand and the integration of Infinera. Operating profit was $434 million, and operating margin increased 70 basis points to 9%. The quarter benefited from some software revenue recognition coming in quarter 2 instead of quarter 3. We also incurred higher stock-based compensation expense which represented 150 basis points headwind to our operating margin in quarter 2 year-on-year, and this was driven by Nokia's share price increase, an increase in the program and the issuance happening earlier in this year. Financial income and expenses benefited from a positive venture fund revaluation during the quarter, which supported both net profit and EPS, earnings per share. Free cash flow was negative EUR 732 million. And as you know, quarter 2 is typically the weakest quarter for cash generation as employee cash incentives are paid in quarter 2. We also saw some increase in working capital during the quarter. We ended quarter 2 with a net cash position of EUR 2.8 billion, maintaining a strong balance sheet and significant financial flexibility. Let me now turn to network infrastructure. Net sales grew 12% in the quarter, reflecting continued strength across the business. Optical networks grew 20% and growth was supported by continued demand from AI and cloud customers, but we also saw healthy demand from telecom customers investing in transport infrastructure. IP Networks grew 16%. The strong order momentum that began in the second half of 2025 is now translating into revenue growth. Fixed Networks declined 2%. The areas where we are prioritizing investment performed well. Optical line terminal sales grew 18%, while O&T sales declined 16% as we continue to focus on higher-value parts of the portfolio. Gross margin increased 240 basis points to 42.7%. This improvement was driven by 3 factors. First, we benefited from a higher scale as revenue increased; second, we continued to realize synergies from the Infinera acquisition; and third, we saw more favorable mix within fixed networks. The gross margin improvement was partially offset by growth investments we are making across optical networks and IP networks as we position ourselves to capture the long-term opportunity in AI infrastructure. And finally, operating margin increased 170 basis points to 8.1%. And turning to mobile infrastructure. Net sales grew 7% in the quarter, Core Software grew 1%, Radio Networks 7% and Technology Standards increased 15%. And Technology Standards benefited from signing a few new agreements during the quarter and included some catch-up revenue recognition. Looking at the full year, we continue to expect Technology Standards to deliver a similar level of sales and profitability as in 2025. Gross margin was 49.3%, which was somewhat better than we expected entering the quarter. And the main driver was a higher contribution from software sales as some revenue were expected in quarter 3 ended up benefiting quarter 2 gross margin. Looking ahead, because of the earlier software revenue phasing, we currently expect mobile infrastructure gross margin in quarter 3 to be closer to 44% to 46%, reflecting a lower software contribution before improving again in quarter 4, in line with normal seasonality, and operating profit was stable year-on-year. Looking at sales by customer segment. AI and Cloud was again the fastest-growing segment, with net sales increasing 105% year-on-year. Growth was broad-based across both optical and IP networks. Telecom sales increased 4%, while technology licensing grew 15%. And we remain optimistic about the long-term AI and Cloud opportunity and continue to see strong customer demand. At the same time, our expectations for the telecom market remain mostly unchanged. Turning to restructuring and integration costs. First, we are on track to complete our 2023, 2026 restructuring program this year and achieved EUR 1.2 billion in gross cost savings. The second area is the integration of our Chinese operations into Nokia's global operating model after taking full ownership at the end of 2025. As we discussed previously, we continue to adjust our operating structure to reflect market conditions and improve competitiveness. As a reminder, this program was expected to achieve EUR 200 million in cost synergies with onetime charges of between EUR 350 million and EUR 400 million over 2- to 3-year period. We now expect to recognize approximately EUR 350 million of the planned onetime charges by the end of 2026 as we accelerated the integration to complete it within 2 years. And the third area is a set of new efficiency progress, mainly impacting Europe. These programs are expected to lead to restructuring charges of EUR 200 million in 2026. These actions are focused on simplifying the organization, improving productivity, and ensuring resources are aligned with our strategic priorities. Overall, we expect restructuring charges of approximately EUR 800 million in 2026. Then let's go to cash. With respect to cash flow, the quarter followed the normal seasonality we typically see in quarter 2. The largest impact was the payment of annual employee incentives related to 2025 performance. We also saw some working capital buildup during the quarter reflecting the continued growth of the business. Despite these seasonal factors, our overall cash generation profile remains unchanged. Considering some of the increased restructuring costs and as we make some investments in working capital to prepare for growth, we now expect to track towards the low end of our free cash flow conversion assumption of 55% to 75%. And finally, turning to our outlook. There is no operational change to our comparable operating profit guidance. The only adjustment is the technical change resulting from the move of fixed-line access and enterprise campus edge into discontinued operations. And we continue to track somewhat above the midpoint of our operating profit range. Looking at quarter 3, specifically, we currently assume a sequential increase in net sales of between 3% and 7%. For operating profit, we currently expect a result broadly similar to quarter 2 due to the phasing of software sales in mobile infrastructure between quarter 2 and quarter 3, followed by a meaningful improvement in quarter 4. And this is a combination of the normal seasonality we see in our telco business and the contribution from year-on-year growth in AI and cloud sales. Aside from the discontinued operations adjustment, our outlook assumptions remain largely unchanged. The demand environment remains supportive, and we allocate capital where we see the strongest opportunities for long-term growth while maintaining discipline on profitability and cash generation. David Mulholland: Thank you, Justin and Marco. As usual, for the Q&A session, as a courtesy to others in the queue, could you please limit yourself to one question and a brief follow-up. Operator, could you please give the instructions? Operator: [Operator Instructions] I will now hand the call back to David Mulholland, Head of Investor Relations for the Q&A. David Mulholland: Thanks, Anny. We'll take our first question today from Terence Tsui from Morgan Stanley. Terence Tsui: I hope you can hear me okay. I had a question around capacity and particularly around the 4 new DSPs planned by the end of 2027. So this is actually a big ramp-up compared to the previous run rate. Can you give us some milestones to lookout for and reassurance that this could be achieved? Justin Hotard: Sure, Terence. I mean, I think, first of all, we talked about these going into customer trial in '27 and then become commercially available towards the end of '27. I think the thing I would just emphasize and remind you of on this is that Nokia and Infinera, previously were each building two DSPs individually. So collectively, a total of four DSPs. One of the decisions we made, and I've talked about this a bit as we saw the growth opportunity emerging in optical was to maintain the DSP team as is versus reducing them. And the reason we did that was we felt quite strongly in spending time with our customers that we could actually deliver more differentiated products to them with four unique DSPs versus the traditional two that we had been delivering in each company independently. And that laid out and supported the road map that we launched at OFC in March, and I touched on that a bit in last quarter's call. So the view here is that we think this gives us better market coverage aligned to where the market is evolving, specifically given the amount of investment we're seeing across the different layers of optical fabric from the scale across fabric to what we see in data center interconnect to metro network to long-haul transport. So across all of that, we've got -- we think we have a much better portfolio in 2027 to address each of the unique evolving solutions than we would have had if we had only kept two versions. David Mulholland: Do you have a follow-up, Terence? Terence Tsui: A real quick follow-up on the comments around the order book potentially being lumpy. Do you still expect like an upward to try over the longer term from these levels, albeit it would come along the way? Justin Hotard: Yes. Look, I think two things about this quarter -- this quarter's order book. I mean obviously, if you do the book-to-bill on this, it's a significant jump up. So I think for me, that's a data point around a little bit of lumpiness, but the other is the elongation of the orders, which we've been talking about expecting and we're seeing here. So I think we have to look at it in both those dimensions. And -- the way I think about orders is I think about orders in a period of time, right? Because it's easy to give you a headline number and then say, well, the next question is, is that over quarter period, a 4-quarter period, an 8-quarter, 12-quarter, et cetera. And so for me, that's really where we're focused, is not necessarily on. Are we getting big order pops consistently, but rather are we seeing the order momentum grow as we look at it over a time period. And right now, what we're seeing is continued growth and continued demand in the market. And as I said in my comments is still largely driven by AI and cloud, particularly around scale across and data center interconnect. And then we're starting to see some emerging growth. We saw some of it in sales this year in our telco customer base. And we believe that's also tied to AI demand. David Mulholland: We'll take our next question from Simon Leopold from Raymond James. Simon Leopold: Can you hear me now, David? David Mulholland: Yes, go ahead, Simon. Simon Leopold: Okay. Great. Great. I didn't expect that button to pop up, sorry. I wanted to see if you could rank order and characterize supply chain risk. And I'm thinking about issues like memory printed circuit boards and even indium phosphide wafers. Maybe a particular focus on that latter one, the wafers given the factory expansion, whether or not you can get the material? And then I've got a quick follow-up after. Justin Hotard: Sure. Look, I think the most -- if I think about the supply chain risks or the time that we're spending in this, first of all, as you rightly point out, it's broad-based, right? So I think we talk a lot about memory. And memory is significant just given the amount of demand that is in the market. I think this has been talked about quite a bit across multiple companies and multiple parts of this ecosystem. So there's clearly constraints there. And then obviously, the pricing -- the significant change in pricing driven by that shortage which, again, has been talked about very broadly across the tech ecosystem. So that's probably the one that we see as most significant. Now we talked about this last quarter. I think I don't need to repeat what I said last quarter, but maybe briefly. Our focus is on securing supply, simplifying our designs, looking at where we can reduce scope wherever possible on our designs. And of course, then passing that on to customers. And I think -- if you look at what we said last quarter, there were some companies with us last quarter. It seems like more companies have joined us in some of the more recent earnings call now making that same comment. The key thing for me here is also really talking to our customers, not the AI and cloud customers, they understand this well. But really making sure our telco, our mission-critical customers understand that we have elongated lead times, which means better visibility, better planning, and something that we need to team with them on. So particularly important in that regard. And then as you touch on, there's a broad base across the board. On the indium phosphide question you asked, Simon, the comment I'll make is this new fab is really looking at -- is looking at coming online probably earliest in '29. And if you think about our capacity, we've got significant jump up with San Jose coming, call it, '27 as it ramps volume, right, manufacturing later this year or volume manufacturing later this year. So '27, it ramps, then we kind of line up for a '29 ramp in incremental capacity. As you know, that's kind of the time lines that you have to take with these investments. And I think as we're looking at it, we're looking out at different solutions to get indium phosphide capacity at that time. That's obviously an industry issue, though, it's something that all of us in the industry need to enable, and it's something that I think collectively, we need to solve even across the ecosystem. David Mulholland: Simon, do you have a follow-up? Simon Leopold: Yes. I wanted to see if maybe you could offer us your view on the scale across market and your ambitions -- Nokia's ambitions for this particular application considering optical and IP routing? Justin Hotard: Yes. Yes, absolutely. I mean I think, first of all, Simon, I think there's a lot of I'm going to be a little technical, but scale across is technically was talking about data centers within a given campus area that were strung together as an AI factory. And one of the things I talked about last -- on the last call was the demand we're seeing in data center interconnect. So my point in saying that is some of what we're seeing is just increased data center interconnect. Now you can call it scale across or some folks may want to label it one way or another. To me, they're very different. They're complementary and very important applications. Because one is back-end connectivity, which is providing connectivity to expand the back end for scale out, which is the scale of cost fabric. The other is data center interconnect providing higher bandwidth between data centers over a long haul on the front end. Both of those have a routing element. Obviously, the data center interconnect has a very significant demand growth in routing. And if you look at our opportunity and why we're talking about growth and in both IP and optical, it's because we're seeing growth in both of those elements. So they are complementary they are reinforcing. The other thing I'll say is, it's not limited to that. We are seeing some traction in back -- in some of the back-end switching. It's on a limited basis, obviously, without getting into all the market dynamics there. But all of this is encouraging in terms of our focus in this area and the traction we're starting to make. David Mulholland: We will take our next question from Sami Sarkamies from Danske Bank. Sami Sarkamies: My question would be on your supply capability in optical networks. Are you fully constrained? Or have you been able to build any inventory during the first half of the year? Justin Hotard: Yes. I would say, Sami, it's a good question. There are always pockets think of legacy products and those areas where we probably have some supply. But in general, I would think of us as being constrained, right? When we talk about lead times elongating it's because we're seeing constraints and particularly on the leading edge products. And by the way, I don't think we're unique in that. I think that's -- if you look at our ecosystem, again, I think you see the constraints and you see that across the component suppliers or some of our peers, et cetera. So obviously, we're working aggressively on that and maximizing the supply. But as I've said as well, if you look at our forecast, what we've included in our forecast is the demand that we have line of sight to shipping and we recognize even that has some risk because that assumes continuity of supply, no disruptions. Everything goes perfectly. So when we're thinking about this, we're thinking about it from a constraint perspective, aligned to what we have line of sight to in supply. But absolutely, if there was more supply, I think we'd probably generate more revenue. David Mulholland: Did you have a follow-up, Sami? Sami Sarkamies: Yes. Regarding radio networks, just curious, do you think you are currently gaining share? You had a 5% organic growth in the first half of the year I think that's a bit more than your main European rival is having or is it just like timing? Justin Hotard: Yes. My view on this, Sami, is it's timing. We talked about -- actually, Marco talked about the timing around the software revenue recognition we had in Q2, which is tied to our radio software platforms. So I would call this timing. I also think looking at market share on a quarterly basis in this industry is super challenging to get any kind of good signal. I think you have to look at it certainly on an annual basis. David Mulholland: Let's take our next question from Alex Duval from Goldman Sachs. Alexander Duval: You talked about further progress in AI RAN. I wondered if you could talk a bit about the time line this benefiting Nokia in terms of revenue and competitive position, and what your discussions with telco are suggesting in that area? And secondly, back to the AI side, I wondered if you could give an update on switching and the progress you make there? Could you help us understand the latest thoughts on switching design-ins and when we should expect orders and revenue momentum given the progress you're delivering? Justin Hotard: Let me answer the second one first. In terms of the switching design wins, we talked about this a little bit last quarter. We said we expect -- we expected orders this year. We saw a lot of those orders come in Q2. Obviously, as you know, in the design win process, you start small, you get traction and then you build on top of that as you validate and execute for performance. So we're continuing to drive that across a number of customers. Obviously, we're pleased with the progress we had in Q2. And then can you just repeat your first question? Alexander Duval: Yes, absolutely, Justin. It was just -- you had mentioned further progress on AI RAN. I'm just curious how you think about the customer feedback and the time lines for that impacting your revenues? Justin Hotard: Yes. I mean, look, I think basically, Alex, everything is consistent with what we've said. Pilots at the end of '26 commercially available in '27. Obviously, we'd anticipate more significant volume going into '28, and that continues to be our expectation in terms of AI RAN. David Mulholland: We'll take our next question from Ulrich Rathe from Bernstein. Ulrich Rathe: Sorry, take some time for the button to appear here. Apologies. So I wanted to come back to the very strong AI cloud order intake, put it into perspective already with regards to the longer the elongation of the order book, as you call it. I was wondering in supply-constrained markets, we often do see double ordering, which does create a full signal for suppliers such as Nokia. How do you see this risk? Are there any specific reasons why this would be an unlikely factor for Nokia? Justin Hotard: Yes. Look, I think, first of all -- if you think about the customers -- the level of sophistication and the customers that are placing these orders, we get to step back and ask what the incentive is for double ordering. I've absolutely seen this much like you in supply-constrained markets that I've worked in, in the past, and it's particularly prevalent in markets where you're focused on enterprise customers where you've got channels because the customers tend to diversify and look for allocation. But in this environment, the thing that I would flag is for one of these customers to come in and say, I'm going to double order with you when ultimately that goes back to supply of leading-edge silicon manufacturing capacity on optical components that the -- they can actively inspect and we transparently share the progress. The question for them would be what does it do in terms of incentives. The other thing I would say is we're -- obviously, as we're making commitments on a longer-term basis, we're expecting those commitments from customers as well. Ulrich Rathe: That's helpful. If I may follow up with one clarification. What would you call a normal length for an order book? Is that essentially 100% of the orders within the next 12 months? Because you highlighted sort of the difference with half of the revenues, is 12 months for 100% "normal" here or not? Justin Hotard: Yes. Ulrich, that's a good question. So I think typically, we have seen orders within 12 months in our customer base. Now again, there's two factors to this. Obviously, one is the growing demand is the fact that AI and cloud is a new segment for us, right? So I would say we've had less exposure to this, obviously, seasonally less exposure to this in the past. And then the second thing is obviously the supply constraint. So I think both of those are factors. But if you think about our traditional business with telco customer -- heavily concentrated with telco customers and then obviously some in mission-critical those orders, we may get -- win a contract award, but we would not -- we would see orders typically within 12 months, and that's really the shift. And -- that's why when I talk about the -- our telco customer base, one of the conversations we're having with those customers is getting more visibility going forward because they're also used to giving us fairly short term within 12 months visibility, and we need to be planning even further. And so this is something that we're -- with all of our sales teams having this conversation to make sure that we're getting better visibility, not because it implies a commitment, but because the risks given the supply constraints in the industry are. We don't want to miss any of their deliveries while we continue to support them given their importance to us as well as customers. David Mulholland: We'll take our next so much from Jakob Bluestone from BNP Paribas. Jakob Bluestone: You're obviously ramping up in terms of AI and cloud revenues. I guess we're not yet seeing it in terms of margins. And I guess my question is just when -- and I appreciate that's obviously, as these businesses scale, margins will go up. And particularly on the IP side, you're just sort of starting to scale now. But just be interested how long do you think it actually takes before these revenues become materially accretive? Justin Hotard: Yes. I think two things, Jacob. So one is gross margin and then the other is operating leverage, right? And as we talked about in Capital Markets Day, we -- we're doing a lot of work at the front end of the 3-year period to really set the company up to become more efficient, more nimble, more scalable and get the operating leverage as we drive growth in the business. So that's a key focus. And we talked about that by nature, that would be a little bit back-end loaded. Now like I said, I'm very pleased with the progress we're making. And obviously, with the demand accelerating higher than what we said at Capital Markets Day, we've got optimism on progress there that will continue to improve. On the other side, on the gross margin side, this is an area where I think we're dealing with just a lot of complexity in the mix. And this is a little bit of supply chain. This is also us -- we talked about the focus we're making in FN on exiting low-margin business. So some of those things are just playing through in the business, and you're not quite seeing a drop to the bottom line yet. But obviously, we're very clear on what we're anticipating. And based on the assumptions we shared at Capital Markets Day, and the progress that we're making ahead of those in terms of revenue growth. Jakob Bluestone: Very clear. And if I can just ask a quick follow-up. Just -- I mean, you mentioned you've got several customers coming in on the IP side, I think you said. And I'd just be interested in understanding just sort of the level of concentration of that customer mix. I mean, would you say you're well represented across the different hyperscaler customers or would you say still a relatively narrow segment? Justin Hotard: Yes, I think we've talked about this a little bit before. It's fairly concentrated today. But that's the way you build the business, right? And so I think we've got very good partnerships and relationships across many of the AI and cloud players, the hyperscalers. The focus right now is obviously on making sure where we do have demand that we're delivering it and we're continuing to innovate for those customers and then over time, obviously, expanding that footprint. David Mulholland: We'll take our next question from Oliver Wong from Bank of America. Oliver Wong: My first question is in terms of the EUR 2.8 billion AI orders in the quarter, I understand that a significant portion pertains to some of your significant design wins in data center switches from last quarter. So I think it will be helpful if you could maybe try to quantify or guide us a little bit on kind of how much of the order or the total AI orders this quarter that kind of comprised just so that we can have a better sense of underlying optical related demand in the quarter? Justin Hotard: Yes. I mean I think I would say it was -- it was driven by optical and IP weighted towards optical, and that's probably not a surprise given the momentum we're seeing right now in that market. Oliver Wong: Got it. And a quick follow-up. In terms of within optical, you mentioned you discussed briefly about sort of skilled cross versus regular DCI. I was just wondering what the composition of demand is right now between the two? Justin Hotard: Yes. I don't think we're breaking that out right now. I just would highlight that I think there's a significant amount of demand in DCI as well as scale across. And I think that gets -- I think the two kind of get either pushed together or maybe the DCI piece gets underappreciated. But that's certainly where for us, we're seeing traction on both. David Mulholland: Our next question is from Richard Kramer from Arete. Richard Kramer: Justin, my first question for you is on the AI RAN transition, your customer installed base runs on Nokia proprietary silicon. Do you see the industry long term shifting away from that proprietary silicon-based set of solutions? And what are the implications for what is a EUR 3 billion run rate of mobile R&D? And what will Networks margins for that transition? Justin Hotard: Richard, so a couple of things on this. First of all, I've talked about this pretty openly. I think we're at a point where the industry has to transition. I think we look at what we see on AI RAN and the spectral efficiency, by the way, we'll have special efficiency on our existing hardware. We'll have some improvements in software. But there'll be an order of magnitude below what we're talking about on AI RAN. But the second thing here is that when you look at leading-edge silicon, you do the math on the cost of leading-edge silicon. And then, by the way, the supply constraints on leading-edge silicon, in my mind, this is a very clear industry shift that has to happen on the baseband, and that is a shift to general purpose silicon. And of course, we're partnered with NVIDIA in launching the AI RAN solution. There are other players out there with general purpose-based solutions that are delivering virtualized RAN stacks. So I don't think we're alone in this move. Fundamentally, as we think about the R&D in this space, this is the other thing I've touched on. When you look at this industry, there's two fundamental challenges and certainly from 4G and 5G. One of them is that the cost of capital, the return on invested capital in -- at an operator level in aggregate hasn't delivered, right, in terms of the investment, certainly looking at 5G, but also 4G. If you look at it from a supplier perspective, a technology provider like us, it also hasn't been acceptable on our side. And so I think we also have to look at how we shift investment and generate a better return on invested capital. Getting out of purpose silicon on the baseband is a step in that direction. And that's why we said that's the long-term direction. I think it's incredibly compelling when you can also say to customer. By the way, look at the better efficiency you can get on your hardware, which means you're going to get a better return on that hardware investment. And then the last thing we're saying is, by the way, when we deliver the hardware, that's not the best performance you're going to get. We'll continue to provide performance enhancements. As an industry, we've always added features, but the fact that we're now adding performance capabilities in our software stack, we think is a huge advantage. And the final point I'll make is, as we've talked about in the software stack, this is a single software stack. So we've got capabilities to optimize it for different hardware, including our legacy stack and of course, the NVIDIA GPUs that are now making -- they're now coming into our portfolio on the AI RAN platform, but it's a single software stack. So we're getting a tremendous amount of leverage out of that stack. So this is right on that path. Richard Kramer: Okay. And then a quick follow-up for Marco, if I may. Your comments about being above the midpoint of your full year profit guidance, but having flattish profits in third quarter suggests you're going to more than double profits in Q4. Can you talk through the drivers of that, be it software revenue recognition, licensing, product deliveries, cost reductions, especially given the cash outflows for restructuring CapEx, working capital, et cetera, that we're seeing now and can expect in second half? Marco Wiren: Yes. Thank you. I would say that if you look the normal seasonality that the industry has, specifically on a telecom customer base side is usually very Q4 delivery heavy. And that's why we've seen in the past years as well that, that part of the industry usually generates the biggest profits and sales as well in quarter 4. And now in addition, then we see also increase in AI and cloud customer base that is also impacting the seasonality of our operations and also profit generation. What comes to restructuring that we -- the program that we announced in '23 -- end of '23, that we will end in end of this year. And we expect that we will get those EUR 1.2 billion accumulated gross cost savings, just like we said as well. and nation that we expect to actually accelerate the synergy program that I mentioned earlier, when it comes to the China company that we took over 100%. And then also, we had some additional voluntary based cost savings restructuring also in Europe and those we will take this year as well. But altogether, if you look at our cash position, we have a very strong position. Now we had EUR 2.8 billion net cash end of quarter 2. We had some inventory and working capital increase in quarter 2 to secure also deliveries going forward. And then, of course, we can't recipes follow normal sales pattern as well. But we believe also by the end of the year, we have very good financial position and cash position. So I don't see any issues there. David Mulholland: We'll take our next question from Sandeep Deshpande from JPMorgan. Sandeep Deshpande: I want to understand from your order book in on cloud in the quarter [Technical Difficulty] David Mulholland: Sandeep, we're really struggling to hear you, Sandeep. Sandeep Deshpande: Do you hear me? Can you hear me better now? David Mulholland: That's a little better. Sandeep Deshpande: Yes. So you now strong in cloud in the quarter. How much -- I mean, last quarter, you had said that the EUR 1 billion of orders, what an ongoing order intake, even though you will have lumpiness in your orders, how much of this EUR 2.8 billion is an ongoing order in equity you characterized? And then secondly, regarding AI and cloud, how should we be looking at a run rate on revenue in this business between optical and IP route? Justin Hotard: Sure. So on the first one, I think we've broken it out for you that what we saw in next 12 months and forward. And I'm not going to break it out any further in terms of -- or try to estimate that for you. But it gives -- that should give you a good view on what's in the coming 4 quarters and what's beyond that. And then in terms of the mix, I think I touched on this. I mean, optical is growing a little bit faster this quarter than IP. But of course, it's starting from a healthier -- just a stronger position. IP were just as we said, we're just starting to ramp in design wins and deliver those. We talked about that last quarter. So I'm pleased with the momentum. And I think if you look at it from the other side, which is 100% year-over-year growth, I think we're set up for a very good continued growth forecast from the AI and cloud segment. David Mulholland: We'll take our next question from Sébastien Sztabowicz from Kepler Cheuvreux. Sébastien Sztabowicz: On Iran coming back, have you seen a specific commercial traction over the past few months? I view being added any new customers trailing your solution. And you are targeting twice more spectral efficiency by 2028. What about the total cost of ownership of the solution? And next to the baseband, do you plan to partner with NVIDIA on GPU for radios? Or it will be mostly focused on the baseband? Justin Hotard: Okay. So three questions. Let me hit them. First of all, I'll start actually with the last one. So the announcement that we made last week was around AI RAN for baseband and the NVIDIA GPU solution going into our AirScale platform, a future stand-alone platform and also having a Cloud RAN coming off-the-shelf server solution. So that's the current announcement. In terms of the spectral efficiency in TCO, as you probably know, that's a -- that TCO ends up being a very customer-specific discussion. But at the macro level, hardware deployment with 100% spectral efficiency improvement. I think the math there speaks for itself in terms of the value creation potential for the operator. And the other key thing is that the software -- this is a software model. So the benefit for the operator is not just TCO, but it's also a CapEx to OpEx transition in terms of ongoing benefit without having to have hardware upgrades. So I think there's a tremendous amount of value when you look at it from a life cycle standpoint. And then in terms of the pilot deployments, we've got -- we've announced 10 public customers on track for later this year. There's many conversations going on about this. We expect to start the deployment of the pilots later this year. Obviously, we expect that will continue into '27. And obviously, as we make progress and we continue to share the progress publicly as we can on the progress we're making, the capabilities we're delivering. But it's more than just spectral efficiency. It's also a platform that's extensible and we talked about this a little bit. It's a bit technical, but you can add -- you can actually put your own applications and services in at the radio layer. And this allows some new capabilities, which we think are going to be pretty attractive to a number of operators, things like sensing and other applications. David Mulholland: We'll take our next question from Rob Sanders from Deutsche Bank. Robert Sanders: First question would just be about the indium phosphide fab ramp. Do you have line of sight to hitting best-in-class 6-inch yields next year? Clearly, Coherent is already doing pretty well. Lumentum seems a bit behind. So where do you stand on that? And the second question would just be around AI RAN. If you look at the top three U.S. operators, how many do you think internally have already gone past the go no-go decision on whether to deploy AI RAN? Justin Hotard: Okay. Got it. Rob, thanks. So I think obviously, we have one operator today in the U.S., Mr. I'll come back to indium phosphide. We have one operator in the U.S. that's got our RAN deployed at scale. That's T-Mobile. They announced that they're going to be our lead partner on the pilot. So obviously, we're working closely with them. I would assume that, that would lead us to conclude that they're probably not past the GoTo deployment path. On the others, I think it's a discussion that obviously we'll leave for them to assess. But my view here is that the GPU performance is compelling, and it's particularly compelling in a business case where spectral efficiency matters, which is going to be more dense operations. But that's obviously -- they've got road maps and strategies is probably better to ask them than ask me. And then on the indium phosphide ramp, what I would say is we've got yield targets that we focused on both yield and volume targets we focused on through 2027 on the fab. My view is while we're -- you rightly said, well, the ecosystem is maturing, and it's not just the two you mentioned, but also the Chinese manufacturers in this space. I also believe this is a place where we're going to go through a significant amount of maturity and learning as we scale -- and scale yield, and that's what I'm focused on with the team versus a specific target or a competitor reach. I think there's actually -- I think this is more about us learning and scaling and making sure we can deliver on our volume plans and obviously, our cost point. David Mulholland: We'll take the next question from Artem Beletski from SEB. Artem Beletski: Relating to A&I, could you maybe comment what type of order intake development you actually see outside of AI and cloud, so namely telcos and mission-critical. So how we should think about the revenue growth trajectory on this front looking at this year and also next year? Marco Wiren: Yes. Thank you, Artem. Just like we mentioned earlier as well that we had a good order intake development and sales development in also non-cloud customer base. So telcos, we're investing more. And this is also driving because of their need to invest in their network to secure that they can deliver the demand that is coming from cloud and AI in general development. And most likely, this will happen broadly -- more broadly going forward as well because we believe that AI demand will continue -- the underlying demand will continue for a longer period of time. And without very good secure networks, it is very difficult to provide those improvements that AI is actually providing. I don't know if you have something you want to add? Justin Hotard: Yes. I would say -- the only thing I would say, Artem, is if you looked at NI specifically, the only headwind, which we talked about last quarter is obviously on the customer premise equipment side of fixed networks where we're getting much more disciplined on margin, that creates a bit of a headwind when you look at NI as a whole. Underneath that is the momentum that Marco talked about in IP and optical. And also, healthy -- obviously, a healthy growth in optical line terminals as well, which is the network side of the fixed networks business. David Mulholland: We'll squeeze one last question in from Felix Henriksson from Nordea. Felix Henriksson: Can you hear me now? David Mulholland: Yes, go ahead. Felix Henriksson: Perfect. So in the report, you say that the IP Networks product mix had an adverse impact on the NI gross margin. Was there something specific to the quarter? Or does this sort of imply that the margin profile in data gene switching products at this scale is sort of dilutive to your gross margins? Justin Hotard: Yes. I think this is largely tied to what we said at the CMD. We'd see some gross margin headwinds as we ramp products in this space, and this is what we're seeing. What I'm focused on is it's -- the business is fundamentally accretive to gross profit and ultimately to our operating margins. And then as we talked about earlier in one of the -- answering one of the questions, making sure we're streamlining the company and driving efficiencies so that we unlock operating leverage. And that's our focus. I mean, obviously, we've got to show that, but when I think about where Marco and I are focused, we're very focused on that side right now. And I think you'll see the margin as we mature in the space continue to improve. David Mulholland: Ladies and gentlemen, that concludes today's call. I would like to remind you that during the call today, we have made a number of forward-looking statements that involve risks and uncertainties. Actual results may, therefore, differ materially from the results currently expected. Factors that could cause such differences can be both external as well as internal operating factors. We have identified such risks in the Risk Factors section of our annual report on Form 20-F, which is available on our Investor Relations website. Thank you for joining us today. Before you buy stock in Nokia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nokia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $369,577!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,301,557!* Now, it’s worth noting Stock Advisor’s total average return is 908% — a market-crushing outperformance compared to 208% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of July 23, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Nokia (NOK) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Nokia stock closed at $9.73 on Thursday, down 5.35%, its lowest close since April 2026. The decline erased the 0.618 Fibonacci golden pocket at $10.41 and extended a slide that began in early June. The selloff followed a second-quarter report that beat estimates but paired accelerating AI demand with warnings on memory shortages. NOK now trades roughly 44% below its June peak of $17.45. Nokia's second-quarter results looked strong on paper. Comparable operating profit rose 18% year-over-year to €434 million, above the €382 million analyst consensus. Net sales reached €4.82 billion, up 9%. Sales to AI and cloud customers doubled to €446 million, while new orders from the segment hit a record €2.8 billion. Nokia targeted this market after a strong Q1, when hyperscaler spending first lifted its optical business. However, investors sold the outlook rather than the quarter. CEO Justin Hotard warned that memory shortages may persist into 2027, as AI companies absorb the industry's DRAM supply and push component prices higher. Meanwhile, legacy weakness persists. Fixed Networks revenue fell 13% as telecom operators delayed spending, and Nokia guided for third-quarter operating profit to be broadly flat versus Q2. The sector backdrop made things worse. Ericsson fell nearly 12% on July 14 after flagging the same memory cost inflation, dragging telecom equipment peers lower. Cracks in memory stocks and broader AI profit-taking added pressure on a stock that was still up about 85% for the year as recently as mid-July. On the daily chart, Nokia stock has been falling since June 3. The Fibonacci retracement drawn from the January low of $6.06 to the June top of $17.45 now maps the decline. NOK first lost the 0.382 level at $13.10 in early July. More importantly, this week it broke below the golden pocket, the 0.618 retracement at $10.41. That zone acted as support in April, and its loss suggests it may now work as resistance. The volume spike during the latest drop is significant. It indicates conviction behind the selling, which favors a continuation of the downtrend. The next target sits at the 0.786 retracement at $8.50, around 12.6% below Thursday's close. This level also aligns with the consolidation area from March and April, which could strengthen it as a demand territory. In contrast, a daily close back above $10.41 would invalidate the bearish outlook. The daily Relative Strength Index (RSI) tells a similar story. Nokia's RSI had respected an ascending support line from November 2025, testing it successfully three times, in February and twice in June. The indicator lost that line in late June. Furthermore, the July bounce was rejected precisely at its underside, confirming the old support as new resistance. Price and RSI have both declined sharply since the rejection. The RSI now reads near 32, just above the oversold threshold at 30. A dip below 30 could produce a short-term bounce, similar to other oversold names in the recent chip rout. However, the momentum structure remains bearish while the broken trendline caps recoveries. For now, the path of least resistance points toward $8.50. Relief in memory costs or strong second-half delivery could revive the AI growth story, but a breakdown below $8.50 would expose the $6.06 anchor low. Read the Original story Nokia Crushed Earnings — and Dropped to Its Lowest Close Since April by Jakub Dziadkowiec at beincrypto.com

Nokia Oyj NOK used its second-quarter earnings call to highlight accelerating demand tied to artificial intelligence (AI) and cloud infrastructure, while management emphasized investments, restructuring and supply capacity expansion. The company maintained its outlook and pointed to AI-driven growth in optical and IP networking as a key focus area entering the second half of 2026. CEO Justin Hotard said Nokia’s strategy is centered on capturing opportunities from the AI supercycle, with early progress reflected in stronger Network Infrastructure results. He highlighted AI and cloud sales growth, broader customer demand and continued investment in differentiated connectivity technologies. The company reported second-quarter net sales growth of 9% on a constant currency basis, with the comparable operating margin expanding to 9%. Network Infrastructure revenues increased 12%, driven by Optical Networks and IP Networks. NOK reported adjusted EPS of $0.08, which beat the Zacks Consensus Estimate of $0.07. Revenues of $5.59 billion, however, missed the Zacks Consensus Estimate of $5.61 billion. Nokia Corporation price-consensus-eps-surprise-chart | Nokia Corporation Quote Nokia said AI and cloud customers remain the strongest growth contributor. Hotard noted that AI and cloud sales more than doubled year over year, while order intake reached EUR 2.8 billion during the quarter. Management emphasized that order patterns can be uneven, but the company continues to benefit from the demand across optical networks and IP networks. Hotard said roughly half of the AI and cloud orders received during the second quarter are expected to convert into revenues over the next 12 months. Nokia also highlighted the launch of its AI-RAN platform, which management said provides operators with a software-based path to improving network performance and supports future 6G upgrades. Supply availability was a key topic during the analyst discussion. A Raymond James analyst asked about risks involving memory, printed circuit boards and indium phosphide wafers. Hotard said memory constraints remain the most significant supply issue and that Nokia is working to secure supply, simplify designs and coordinate with customers on longer lead times. Regarding optical manufacturing, Hotard said Nokia’s capacity investments are designed to support future demand, including expanded indium phosphide manufacturing capabilities. The company is adding capacity in the United States through new facilities and planned expansion projects. Nokia maintained its full-year 2026 comparable operating profit outlook at EUR 2.1 billion to EUR 2.6 billion after a technical adjustment related to discontinued operations. Management said operational expectations remain unchanged. CFO Marco Wiren said the company continues to track somewhat above the midpoint of its operating profit guidance range. He added that third-quarter sales are expected to increase sequentially by 3-7%, while operating profit is expected to remain broadly similar to the second quarter before improving in the fourth quarter. Nokia also expects restructuring charges of approximately EUR 800 million in 2026 as it accelerates efficiency programs and organizational changes. Optical Networks remained a central investment area, with second-quarter sales increasing 20% on a constant currency basis. IP Networks revenues rose 16%, supported by AI and cloud demand. Hotard said Nokia is maintaining investments in optical manufacturing capacity to support long-term demand. The company is advancing its San Jose facility and expanding testing and packaging capacity in Pennsylvania. NOK also discussed its focus on concentrating resources in areas where it sees stronger differentiation while reducing exposure to lower-priority businesses. The company classified Fixed Wireless Access CPE and Enterprise Campus Edge as discontinued operations. Analysts focused on the durability of AI infrastructure demand and whether recent order strength can continue. A Morgan Stanley analyst questioned the sustainability of higher-order levels. Hotard said Nokia is focused on long-term order momentum rather than quarter-to-quarter fluctuations. He emphasized that customer demand remains strong, particularly in data center interconnect and AI-related networking applications. A Danske Bank analyst also asked about optical supply capacity. Management reiterated that current investments are intended to align manufacturing capabilities with expected market expansion. Hotard said Nokia entered the second half of 2026 with momentum driven by AI and cloud demand, while continuing to reshape operations around growth opportunities. Management emphasized technology development, internal productivity improvements and disciplined capital allocation. The company’s strategy remains focused on scaling businesses tied to AI infrastructure while improving operational efficiency. Nokia’s outlook reflects continued investment alongside cost actions. NOK carries a Zacks Rank #3 (Hold), which indicates that the stock’s current earnings estimate revision trend does not place it among the strongest or weakest Zacks-ranked stocks. The Zacks Rank can change as analysts update earnings estimates following quarterly results. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The stock has a Value Score of C, Growth Score of C, Momentum Score of A and VGM Score of B. Zacks Style Scores rank stocks from A to F, with higher scores representing stronger characteristics for each style category. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nokia Corporation (NOK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Nokia Corporation's NOK latest quarterly results reflected both encouraging operational progress and ongoing industry challenges. The company reported earnings that exceeded expectations, supported by stronger margins and robust performance in several businesses, but revenue came in slightly below forecasts as telecom spending remained uneven across key markets. The quarter illustrates how Nokia is benefiting from growing demand for AI networking and cloud infrastructure while continuing to navigate restructuring efforts and cyclical carrier investment. Nokia's latest quarter demonstrated improving operational execution despite a mixed top-line performance. The company reported an earnings beat as stronger margins and disciplined cost management helped offset softer-than-expected revenue. Comparable gross margin increased to 46%, while comparable operating margin reached 9%, reflecting improved profitability even as reported results continued to be affected by restructuring-related charges. Management also reaffirmed its full-year comparable operating profit outlook, indicating confidence that underlying business trends remain on track.The results suggest Nokia is making progress on improving the quality of its earnings rather than simply pursuing revenue growth. Higher-margin businesses and ongoing efficiency initiatives supported profitability, although uneven customer spending continued to weigh on overall sales performance. Image Source: Zacks Investment Research Network Infrastructure remained Nokia's strongest-performing segment, driven by continued momentum in Optical Networks and IP Networks as enterprises and hyperscale cloud providers expanded AI infrastructure investments. AI and Cloud revenues more than doubled from the prior-year period, highlighting the company's growing exposure to structural technology trends beyond traditional telecom spending.Technology Licensing also remained an important contributor by generating recurring royalty income from Nokia's extensive patent portfolio. Regionally, the company saw encouraging performance across the Americas and EMEA, while results in APAC reflected a more mixed demand environment. Similar AI-driven networking opportunities are also supporting industry peers such as Cisco Systems CSCO and Ciena Corporation CIEN as cloud infrastructure investment continues to accelerate. While profitability improved, cash flow remained an area investors should monitor. Nokia reported negative operating cash flow and free cash flow during the quarter, primarily reflecting working capital movements, restructuring-related cash payments and ongoing capital investments. These factors pressured near-term cash generation despite stronger operating performance.Even so, the company continues to maintain a solid liquidity position, providing flexibility to fund strategic investments, restructuring initiatives and manufacturing expansion. Management expects cash flow to improve as working capital normalizes and operational efficiencies continue to take effect. Image Source: Zacks Investment Research Management reaffirmed its full-year comparable operating profit guidance of €2.1 billion to €2.6 billion and continues to expect solid free cash flow conversion over the course of the year. The company also anticipates continued strength in Network Infrastructure, supported by growing demand for Optical Networks and IP Networks tied to AI and cloud deployments.Alongside these growth opportunities, Nokia continues investing in manufacturing capacity and technology development to support future demand. While telecom spending remains uneven, management believes expanding exposure to enterprise networking and AI infrastructure should help improve the company's long-term financial profile. Nokia currently carries a Zacks Rank #3 (Hold), with a Value Score of B, Growth Score of C, Momentum Score of A and VGM Score of B. These ratings reflect a company that is showing improving operational execution and strong momentum while still working through restructuring activities and uneven revenue trends. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Overall, Nokia's latest financial results point to a business that is gradually strengthening its fundamentals. Margin improvement, Network Infrastructure growth and rising AI-related demand provide encouraging signs for the future, while cash flow execution and telecom market conditions remain important areas to watch. The current Hold rating reflects this balanced financial picture as the company's transformation continues. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nokia Corporation (NOK) : Free Stock Analysis Report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report Ciena Corporation (CIEN) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Nokia Corporation NOK reported mixed second-quarter 2026 results, with the bottom line beating the Zacks Consensus Estimate, but the top line missing the same. The company's top line increased year over year, primarily owing to robust growth in Optical Networks and IP Networks within the Network Infrastructure segment, supported by strong AI & Cloud demand. Nokia reported a net income of €5 million ($5.8 million) or €0.00 per share in the second quarter against a net income of €96 million or €0.02 per share in the year-ago quarter. Accelerated restructuring charges weighed on reported profits despite higher net sales.Comparable profit was €414 million ($481.4 million) or €0.07 (8 cents) per share, up from €252 million or €0.04 in the year-earlier quarter. The bottom line beat the Zacks Consensus Estimate of 7 cents. Nokia Corporation price-consensus-eps-surprise-chart | Nokia Corporation Quote Quarterly net sales were €4.82 billion ($5.60 billion), up 8% from €4.44 billion in the year-ago quarter. Growth was primarily driven by strength in the Network Infrastructure segment, fueled by robust demand from AI & Cloud customers. However, revenues missed the Zacks Consensus Estimate of $5.62 billion.Net sales from Network Infrastructure totaled €2.04 billion ($2.37 billion), increasing from €1.83 billion in the year-ago quarter. On a constant currency basis, IP Networks recorded 16% year-over-year growth, supported by strong AI & Cloud demand and robust order intake. Revenues from Optical Networks surged 20% year over year, driven by AI & Cloud and telecom provider demand, particularly in the Americas. Meanwhile, Fixed Networks declined 2% year over year, reflecting lower sales of consumer-premise fiber products as Nokia continued to prioritize higher-margin offerings, partly offset by stronger operator-premise fiber optical line terminal sales.Mobile Infrastructure generated revenues of €2.68 billion ($3.12 billion), up 6% year over year on a reported basis and 7% on a constant currency basis. Growth was driven by strength in Radio Networks and Technology Standards, while Core Software recorded modest growth.Net sales from Portfolio Businesses were €94 million ($109.3 million), up 6% year over year on both a reported and constant currency basis. Growth was primarily driven by Site Implementation and Outside Plant, which also supported a significant improvement in profitability during the quarter.Technology Standards (reported under Mobile Infrastructure) contributed €407 million ($473.1 million) compared with €357 million in the year-ago quarter. Net sales increased 15% on a constant currency basis, driven by licensing agreements signed during the quarter, including a benefit from catch-up net sales.Region-wise, net sales from the EMEA region increased to €2.06 billion ($2.39 billion) from €1.91 billion in the year-earlier quarter, reflecting broad-based growth across businesses.Revenues in the APAC region increased to €982 million ($1.14 billion) from €913 million in the year-ago quarter, supported by growth across both Network Infrastructure and Mobile Infrastructure.The Americas region generated net sales of €1.78 billion ($2.07 billion), up from €1.62 billion in the prior-year quarter, driven by strong demand in AI & Cloud, particularly for Optical Networks and IP Networks. In the June quarter, the comparable gross margin was 46%, up from 45.3% in the year-ago quarter. Comparable operating profit increased 18% year over year to €434 million ($504.5 million). Comparable operating margin expanded to 9% from 8.3% in the year-ago quarter. In the June quarter, Nokia used €620 million ($720.7 million) in net cash from operating activities. Free cash flow was negative €732 million ($850.9 million), primarily due to working capital outflows, restructuring-related cash charges and capital expenditures.As of June 30, 2026, the company had €4.35 billion ($5.06 billion) in cash and cash equivalents, with long-term interest-bearing liabilities of €1.92 billion ($2.23 billion). For 2026, Nokia expects comparable operating profit in the range of €2.1-€2.6 billion, reflecting a technical revision from the previous range following the reclassification of two businesses as discontinued operations. Operationally, the company's outlook remains unchanged. Free cash flow conversion is projected at 55-75% of comparable operating profit, while capital expenditure is estimated to be in the range of €800-€900 million.The company continues to expect Network Infrastructure net sales to grow 12-14% in 2026 on a constant currency and portfolio basis, including 18-20% growth for the combined IP Networks and Optical Networks businesses, supported by sustained demand from AI & Cloud customers. NOK currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Arista Networks Inc. ANET is scheduled to release second-quarter 2026 earnings on Aug. 8. The Zacks Consensus Estimate for earnings is pegged at 89 cents per share, suggesting growth of 21.92% from the year-ago reported figure.Arista has a long-term earnings growth expectation of 19.86%. The company delivered an average earnings surprise of 8.31% in the last four reported quarters.Amphenol Corporation APH is set to release second-quarter 2026 earnings on July 29. The Zacks Consensus Estimate for earnings is pegged at $1.19 per share, implying growth of 46.91% from the year-ago reported figure.Amphenol has a long-term earnings growth expectation of 24.01%. The company delivered an average earnings surprise of 14.08% in the last four reported quarters.Corning Incorporated GLW is set to release second-quarter 2026 earnings on July 28. The Zacks Consensus Estimate for earnings is pegged at 76 cents per share, implying growth of 26.67% from the year-ago reported figure.Corning has a long-term earnings growth expectation of 23.89%. The company delivered an average earnings surprise of 2.41% in the last four reported quarters. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nokia Corporation (NOK) : Free Stock Analysis Report Amphenol Corporation (APH) : Free Stock Analysis Report Corning Incorporated (GLW) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research