Jamie Spencer
Nokia (NOKIA.HE) announced on Monday that Pekka Lundmark will step down as CEO, with Justin Hotard set to take over the role on April 1. Hotard, an executive at Intel (INTC.O), brings extensive experience in AI and data center markets, signaling Nokia’s strategic shift toward new growth areas.
CEO Transition and Market Reaction
- Pekka Lundmark will stay on as an advisor until the end of the year.
- Nokia’s stock rose 1.6% following the announcement.
- JPMorgan analysts described the leadership change as unexpected but noted it had likely been planned for some time.
“With the data center and AI background of the new CEO, it is clear which areas Nokia wants to focus on,” JPMorgan said in a note.
Nokia’s AI and Infrastructure Strategy
Nokia, like other telecom equipment makers, has been facing challenges in its 5G business and is increasingly shifting toward AI-driven infrastructure. The company’s focus areas include:
- Network Infrastructure: Expanding AI and data center capabilities.
- Mobile Networks: Continuing 5G technology development.
In a major move last year, Nokia acquired U.S.-based Infinera (INFN.O) for $2.3 billion, targeting growth in AI-powered data centers.
Leadership Change Reflects Strategic Shift
Sari Baldauf, Nokia’s chair, confirmed that the transition was initiated when Lundmark expressed interest in moving on after repositioning the company.
“He has a strong track record of accelerating growth in technology companies along with vast expertise in AI and data center markets,” Baldauf said.
Nokia’s Stock Performance
Nokia shares have climbed 27.85% over the past year but remain down over 90% from their peak in June 2000.
With Justin Hotard at the helm, Nokia is doubling down on AI and data center investments, signaling a clear pivot toward next-generation telecom infrastructure. Investors will be watching closely to see how this transition plays out in Nokia’s long-term strategy.
