Nokia just earned an overweight rating from Morgan Stanley, lifting its price target to €6.50 from €4.20. The upgrade follows years of restructuring that trimmed the firm’s balance sheet and sharpened its focus on AI and data center infrastructure for telecom operators worldwide and cloud providers.

Acquisition of Infinera in February 2025 shifted Nokia’s revenue mix, pushing AI and cloud sales to roughly 6% of total income and growing by about one percentage point each quarter. That uptick aligns with a 15% annual rise in the addressable market for global operators.

Optical network orders surged over 40% year‑on‑year, while data‑center switching orders jumped more than 150%. Morgan Stanley sees these trends as a springboard for near‑term revenue growth and a stronger EBIT outlook, projecting 2028 earnings 10% above consensus for future growth in the telecom sector.

With valuation near historical averages—about nine times EBIT—Morgan Stanley believes Nokia’s exposure to AI‑driven networks is undervalued. Investors should watch the company’s next earnings release and the pace of hyperscaler spending, which could confirm the upward trajectory for long‑term growth in the tech sector and and.