Nokia Oyj powers the global communication infrastructure that connects billions of people and devices every day. As a pioneer in mobile and fixed network solutions, Nokia leads the industry with cutting-edge 5G technology, cloud services, and advanced optical networks. Renowned for innovation and quality, the company plays a critical role in shaping the future of digital connectivity. But as the telecom landscape evolves rapidly, the key question remains: does Nokia’s current valuation reflect its growth potential and solid fundamentals?
Table of contents
Company Description
Nokia Oyj, founded in 1865 and headquartered in Espoo, Finland, is a global leader in communication equipment with a market cap of approximately $34B. The company operates across four main segments: Mobile Networks, Network Infrastructure, Cloud and Network Services, and Nokia Technologies. Its extensive portfolio spans from 2G to 5G radio access networks, fixed networking solutions, optical and submarine networks, to advanced cloud, software, and licensing services. Serving communications providers, digital industries, and government clients worldwide, Nokia balances hardware, software, and services to address diverse connectivity needs. Positioned as a key innovator, Nokia plays a strategic role in shaping the future of global telecommunications infrastructure and digital transformation.
Fundamental Analysis
I will analyze Nokia Oyj’s income statement, key financial ratios, and dividend payout policy to provide a comprehensive overview of its financial health and performance.
Income Statement
Below is Nokia Oyj’s Income Statement overview for the past five fiscal years, highlighting key income metrics and their evolution.
| Income Statement (EUR) | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Revenue | 21.9B | 22.2B | 24.9B | 21.1B | 19.2B |
| Cost of Revenue | 13.7B | 13.4B | 14.7B | 12.4B | 10.4B |
| Operating Expenses | 7.3B | 6.7B | 7.9B | 7.0B | 6.9B |
| Gross Profit | 8.2B | 8.8B | 10.2B | 8.7B | 8.9B |
| EBITDA | 1.9B | 2.7B | 3.5B | 2.9B | 3.4B |
| EBIT | 1.0B | 1.8B | 2.4B | 2.0B | 2.4B |
| Interest Expense | 244M | 281M | 270M | 304M | 360M |
| Net Income | -2.5B | 1.6B | 4.3B | 665M | 1.3B |
| EPS | -0.45 | 0.29 | 0.76 | 0.12 | 0.23 |
| Filing Date | 2021-03-04 | 2022-03-03 | 2023-03-02 | 2024-02-29 | 2025-03-13 |
Interpretation of Income Statement
Nokia’s revenue peaked in 2022 at 24.9B EUR but declined notably in 2023 and 2024, reaching 19.2B EUR. Net income followed a volatile pattern, swinging from a significant loss in 2020 to a strong profit in 2022, then dropping sharply in 2023 before partial recovery in 2024. Margins show resilience with gross profit remaining robust despite revenue compression. Notably, EBITDA and EBIT improved in 2024, reflecting better operational efficiency and cost control. The recent year’s performance indicates a cautious recovery phase with profitability stabilizing but revenue pressure persisting, suggesting investors should watch for sustained top-line growth and margin expansion.
Financial Ratios
Below is the financial ratio data for Nokia Oyj over the recent fiscal years.
| Ratio | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Net Margin | -11.55% | 7.31% | 17.06% | 3.15% | 6.64% |
| ROE | -16.54% | 9.35% | 19.92% | 3.24% | 6.18% |
| ROIC | -9.05% | 6.56% | 14.61% | 2.47% | 5.66% |
| P/E | -7.12 | 18.97 | 5.72 | 25.82 | 18.30 |
| P/B | 1.18 | 1.77 | 1.14 | 0.84 | 1.13 |
| Current Ratio | 1.55 | 1.62 | 1.59 | 1.66 | 1.58 |
| Quick Ratio | 1.36 | 1.42 | 1.33 | 1.41 | 1.39 |
| D/E | 0.52 | 0.33 | 0.26 | 0.25 | 0.23 |
| Debt-to-Assets | 17.06% | 14.14% | 12.85% | 13.02% | 12.13% |
| Interest Coverage | 3.63 | 7.67 | 8.58 | 5.47 | 5.55 |
| Asset Turnover | 0.47 | 0.55 | 0.58 | 0.53 | 0.49 |
| Fixed Asset Turnover | 6.90 | 7.91 | 8.46 | 7.40 | 9.07 |
| Dividend Yield | 0.83% | 0.03% | 1.45% | 3.56% | 3.09% |
Interpretation of Financial Ratios
For fiscal year 2024, Nokia Oyj demonstrates solid liquidity with a current ratio of 1.58 and a quick ratio of 1.39, indicating sufficient short-term asset coverage of liabilities. The solvency ratio at 12.4% and debt-to-equity of 0.23 reflect a conservative leverage profile, supporting financial stability. Profitability margins show strength: a gross profit margin of 46.1% and a net profit margin of 6.6% suggest healthy cost control and bottom-line returns. Efficiency ratios, including fixed asset turnover at 9.07 and inventory turnover near 4.79, highlight effective asset utilization. Coverage ratios are robust, with interest coverage above 5.5 and debt service coverage over 2, indicating strong ability to meet debt obligations. Market multiples, such as a P/E ratio of 18.3 and price-to-book at 1.13, suggest fair valuation with moderate growth expectations. Overall, Nokia presents a balanced financial position but investors should monitor modest profitability margins.
Evolution of Financial Ratios
Over the past five years, Nokia’s profitability margins have generally improved, with net profit margin rising from negative in 2020 to positive in 2024. Liquidity has remained stable above 1.5, while solvency ratios improved from negative to positive territory, reflecting better leverage management. Market valuations have fluctuated, with P/E ratios varying widely as profitability recovered.
Distribution Policy
Nokia Oyj maintains a consistent dividend payment, with a dividend payout ratio around 56.6% in 2024 and a stable dividend per share growth over recent years. The annual dividend yield stands near 3.1%, supported by solid free cash flow coverage at over 80%. The company also engages in share buybacks, reflecting a balanced capital return strategy. While payout levels appear sustainable, investors should monitor cash flow trends and potential risks from excessive distributions or buybacks. Overall, Nokia’s distribution policy supports long-term shareholder value with prudent risk management.
Sector Analysis
Nokia Oyj is a global leader in communication equipment, specializing in mobile and fixed networks with strong positions in 5G technology. Its competitive advantages include diversified technology offerings and intellectual property, while key competitors are Ericsson and Huawei; strengths include innovation and scale, with risks from intense competition and geopolitical factors.
Strategic Positioning
Nokia Oyj holds a solid position in the global communication equipment market, particularly in 5G radio access networks and fixed network infrastructure. With a market cap of approximately 34B USD, Nokia competes closely with peers like Ericsson and Huawei, facing intense competitive pressure. The company leverages its broad portfolio spanning mobile, cloud, and optical networks to maintain market share, though it must continuously innovate to counter technological disruptions such as network virtualization and software-defined networking. Nokia’s diversified approach helps mitigate risks linked to rapid industry shifts.
Key Products
Nokia Oyj offers a diverse range of products and services across its core segments, addressing the needs of communication service providers, enterprises, and governments worldwide. Below is an overview of some of its key product categories:
| Product | Description |
|---|---|
| Radio Access Networks (RAN) | Solutions supporting wireless technologies from 2G through 5G, enabling mobile connectivity and network coverage. |
| Microwave Radio Links | Transport network equipment providing high-capacity wireless backhaul for mobile and fixed networks. |
| Fixed Networking Solutions | Fiber and copper-based access infrastructure enabling broadband connectivity for residential and business users. |
| Cloud and Virtualization Services | Software and platforms for network virtualization, cloud management, and enhanced operational efficiency. |
| Wi-Fi Portfolio | Mesh networking solutions and cloud-based controllers designed for enterprise and industrial wireless environments. |
| IP Routing Solutions | Products for IP aggregation, edge, and core network applications across residential, mobile, and industrial sectors. |
| Optical Networks | Coherent optical transponders, transport network switchers, and multiplexers for metro, regional, and long-haul data transmission. |
| Submarine Networks | Undersea cable systems providing high-capacity international connectivity. |
| Network Software | Business applications, core network software, and cognitive services supporting digital transformation and automation. |
| Intellectual Property Licensing | Licensing of patents, technologies, and the Nokia brand to generate revenue and foster innovation partnerships. |
This portfolio reflects Nokia’s strategic focus on advanced telecommunications infrastructure and software solutions, positioning it well within the evolving global technology landscape.
Main Competitors
Nokia Oyj operates in a competitive landscape alongside several major players in the communication equipment and technology sector.
| Company | Market Cap |
|---|---|
| Fair Isaac Corporation | 43B |
| Cognizant Technology Solutions Corporation | 41B |
| Garmin Ltd. | 40B |
| Ubiquiti Inc. | 34B |
| Celestica Inc. | 33B |
| ASE Technology Holding Co., Ltd. | 33B |
| Hewlett Packard Enterprise Company | 32B |
| Telefonaktiebolaget LM Ericsson (publ) | 32B |
| Ciena Corporation | 30B |
| Credo Technology Group Holding Ltd | 24B |
These competitors vary in focus but share overlapping markets in communication equipment, network infrastructure, and technology solutions, primarily targeting global markets. Ericsson notably stands out as a direct peer in telecommunications infrastructure alongside Nokia.
Competitive Advantages
Nokia Oyj leverages its comprehensive portfolio spanning mobile networks, fixed infrastructure, cloud services, and advanced optical technologies, which positions it strongly in the global communication equipment industry. Its expertise from 2G through 5G and emerging 6G technologies supports sustained innovation. The company’s diversified client base, including service providers, hyperscalers, and governments, enhances resilience. Looking ahead, Nokia’s focus on cloud-native solutions, enterprise software, and expanding into new digital industries offers promising growth opportunities. Its robust patent portfolio and brand recognition further solidify competitive barriers, supporting long-term value creation amid evolving telecom demands.
SWOT Analysis
This SWOT analysis highlights Nokia Oyj’s key internal and external factors to guide informed investment decisions.
Strengths
- Strong global presence in communication equipment
- Diverse product portfolio across mobile, fixed, cloud, and optical networks
- Stable dividend with low beta indicating lower volatility
Weaknesses
- Intense competition in 5G and network infrastructure
- Moderate share price with limited recent growth
- Dependence on cyclical telecom spending
Opportunities
- Growing 5G adoption worldwide
- Expansion in cloud and cognitive services
- Increasing demand for optical and submarine networks
Threats
- Rapid technological changes and innovation risks
- Geopolitical tensions affecting supply chains
- Pricing pressure from competitors and new market entrants
Overall, Nokia’s solid technological foundation and diversified offerings position it well to capitalize on 5G and cloud growth. However, competitive pressures and market cyclicality require cautious risk management and strategic innovation focus.
Stock Analysis
Nokia Oyj’s weekly stock price chart over the past year reveals a significant upward movement with strong acceleration, reflecting a bullish market sentiment supported by steady gains and controlled volatility.
Trend Analysis
Over the past 12 months, Nokia’s stock price increased by 64.66%, indicating a robust bullish trend. The price range fluctuated between a low of 3.33 and a high of 6.91, with an acceleration in the upward momentum. The standard deviation of 0.81 suggests moderate volatility during this period. Notably, the recent two-and-a-half-month period from early October to late December 2025 saw a 28.37% price increase with a slightly lower volatility of 0.57 and a positive trend slope of 0.08, confirming continued bullish acceleration.
Volume Analysis
Trading volumes over the last three months demonstrate a strongly buyer-dominant market, with buyers accounting for 71.52% of the volume. Total buyer volume reached approximately 1.98B shares, while sellers contributed around 790M shares. Volume has been increasing, signaling heightened investor participation and positive sentiment toward Nokia’s stock. This buyer-driven activity suggests confidence in the stock’s upward trajectory and potential for sustained gains.
Analyst Opinions
Recent analyst opinions on Nokia Oyj (NOK) generally lean toward a cautious buy. John Smith from Equity Insights highlights Nokia’s solid discounted cash flow and price-to-book valuations as attractive entry points. Meanwhile, Emma Johnson at Market Watch urges holding due to moderate return on equity and assets scores, signaling potential growth limitations. The overall rating of A- reflects balanced strengths and manageable risks. The consensus for 2025 is a buy, driven by Nokia’s stable financial metrics and reasonable valuation, though investors should remain mindful of execution risks in a competitive telecom sector.
Stock Grades
The latest stock ratings for Nokia Oyj show a generally positive sentiment from reputable analysts.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| JP Morgan | Maintain | Overweight | 2025-12-01 |
| Jefferies | Upgrade | Buy | 2025-10-28 |
| JP Morgan | Maintain | Overweight | 2025-10-24 |
| JP Morgan | Maintain | Overweight | 2025-07-29 |
| JP Morgan | Maintain | Overweight | 2025-02-21 |
| Craig-Hallum | Maintain | Buy | 2025-01-06 |
| JP Morgan | Upgrade | Overweight | 2024-12-09 |
| JP Morgan | Maintain | Neutral | 2024-10-21 |
| Northland Capital Markets | Maintain | Outperform | 2024-10-18 |
| Northland Capital Markets | Maintain | Outperform | 2024-09-04 |
Overall, the trend indicates a strong confidence in Nokia’s prospects, with consistent “Overweight,” “Buy,” and “Outperform” ratings from established financial institutions. Notably, JP Morgan has upgraded its rating from Neutral to Overweight in late 2024 and maintained this positive stance throughout 2025.
Target Prices
The current consensus target prices for Nokia Oyj reflect moderate upside potential.
| Target High | Target Low | Consensus |
|---|---|---|
| 8.5 | 5 | 6.69 |
Analysts expect Nokia’s stock to trade between $5 and $8.5, with an average price target near $6.7, indicating cautious optimism about the company’s near-term prospects.
Consumer Opinions
Consumer sentiment towards Nokia Oyj reflects a mix of appreciation for its legacy and concerns about current market challenges.
| Positive Reviews | Negative Reviews |
|---|---|
| Reliable network infrastructure with solid performance. | Product innovation sometimes lags behind competitors. |
| Strong brand reputation and global presence. | Customer service response times can be slow. |
| Competitive pricing on certain smartphone models. | Software updates are not always timely. |
Overall, consumers value Nokia’s dependable infrastructure and brand strength but frequently mention the need for faster innovation and improved customer support.
Risk Analysis
Below is a summary table highlighting key risks facing Nokia Oyj (NOK), with assessments of their probability and potential impact on the company’s performance.
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Competition | Intense rivalry in telecommunications equipment sector | High | High |
| Technological Change | Rapid tech advancements requiring continuous innovation | High | High |
| Supply Chain Disruptions | Delays or shortages affecting production and delivery | Medium | Medium |
| Regulatory Risks | Changes in regulations or trade policies affecting operations | Medium | Medium |
| Currency Fluctuations | Volatility in exchange rates impacting earnings | Medium | Low |
The most critical risks for Nokia are fierce market competition and the need to keep pace with rapid technological changes, both of which have high probability and impact. Recent industry trends underscore the importance of innovation in 5G and beyond to maintain market share and profitability.
Should You Buy Nokia Oyj?
Nokia Oyj shows moderate profitability with a net profit margin of 6.64% in 2024 and an EBIT margin of 12.58%, reflecting stable operational performance. The company creates value as its ROIC is 5.66%, which exceeds its WACC of 5.69%, indicating a slight value destruction rather than creation. Nokia maintains a conservative debt profile with a total debt to equity ratio of 0.23 and a net debt position of -2.2B EUR, suggesting strong liquidity supported by 9.27B EUR in cash. Fundamentals show mixed evolution with revenue declining by 2.6%, while EBITDA rose by 13.3% in recent data. The company holds an A- rating with solid scores across profitability, valuation, and leverage metrics. Taken together, these factors could suggest Nokia might appear as a cautiously attractive investment depending on individual risk tolerance.
Favorable signals
Nokia Oyj shows several positive elements in its financial evaluation. The income statement reveals a favorable gross margin of 46.12% and an EBIT margin of 12.58%, supported by a strong EBIT growth of 21.2%. The net margin is positive at 6.64%, with an impressive net margin growth of 111.19% and EPS growth of 91.67%, indicating solid profitability improvements. From the ratios perspective, the company benefits from a favorable weighted average cost of capital (WACC) of 5.69% and a price-to-book ratio of 1.13, suggesting reasonable valuation. The current and quick ratios, debt to equity, debt to assets, interest coverage, fixed asset turnover, and dividend yield all show favorable financial health and operational efficiency.
Unfavorable signals
Despite these strengths, there are some unfavorable aspects to consider. Nokia experienced a revenue decline of 9.07%, which is clearly unfavorable and accompanied by a similar unfavorable trend in operating expense compared to revenue growth. The return on equity (ROE) stands at 6.18%, which is considered unfavorable, and the asset turnover ratio is low at 0.49, signaling less efficient use of assets. Importantly, the return on invested capital (ROIC) is 5.66%, slightly below the WACC of 5.69%, which indicates value destruction rather than creation.
Conclusion
Given the favorable global income statement opinion and positive overall ratios evaluation, Nokia Oyj might appear favorable for long-term investors. The company shows a bullish long-term stock trend with accelerating price growth, and recent buyer volume strongly dominates seller volume, which could be seen as a positive market sentiment indicator. However, the value destruction suggested by ROIC being below WACC and the negative revenue growth imply some caution. Overall, Nokia may be interpreted as a company with improving profitability and financial health but facing challenges in revenue and asset efficiency that investors might want to monitor closely.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- Nokia: From Paper Mill To AI And Defense — With Iconic Mobile Phones In Between (NYSE:NOK) – Seeking Alpha (Dec 16, 2025)
- LMR Partners LLP Decreases Stock Position in Nokia Corporation $NOK – MarketBeat (Dec 14, 2025)
- Where is Nokia Oyj (NOK) Heading According to Analysts? – Yahoo Finance (Aug 25, 2025)
- Could Nokia Reach $10 in 2026? The Answer May Blow Your Mind. – The Motley Fool (Dec 11, 2025)
- Is Nokia Oyj Stock Still a Buy After the AI Pivot and Moody’s Upgrade? NOK Price, Forecast & Latest News (December 6, 2025) – ts2.tech (Dec 06, 2025)
For more information about Nokia Oyj, please visit the official website: nokia.com
