J.P. Morgan upgraded Nokia (NOK, Financials) to "Overweight" from "Neutral," citing anticipated improvements in telecommunications spending and an expanded partnership with Microsoft (MSFT, Financials). NOK stock is up 3.9% on last look and MSFT stock is 0.5%.
Driven by the end of the U.S. telco inventory correction and a fresh wave of 5G investments in India, the investment company projects a slight comeback in telecom industry investments in 2025. Furthermore anticipated to support Nokia's corporate market expansion is its latest partnership with Microsoft Cloud.
Nokia's position as a critical provider of Microsoft's cloud infrastructure was strengthened in November when it renewed its multi-year contract to provide data center networking solutions to Microsoft Azure. Nokia's footprint is expected to grow thanks to this alliance to more than thirty nations. Reflecting confidence in the company's ability to exceed profit projections for 2025, J.P. Morgan therefore boosted Nokia's price target from €4 (about $4.23) to €6.05 (about $6.40).
Beyond this alliance, Nokia has been involved in the defense industry; CEO Pekka Lundmark notes military communication networks as a major income stream, especially in NATO nations and Asian allies. In order to replace Huawei equipment, the business has also signed a deal with Deutsche Telekom to install an Open Radio Access Network across more than 3,000 locations throughout Germany.
Microsoft is keeping ahead in artificial intelligence meantime. Aiming to improve both personal and professional user experiences, CEO Satya Nadella unveiled AI "agents" meant to complete tasks autonomously at the Ignite 2024 conference To further simplify user interactions and increase output, Microsoft has now included Copilot, its artificial intelligence assistant, throughout Windows and Microsoft 365.
