Nokia's 5G slowdown forces a pivot to cloud and undersea cables
Nokia is facing growing pressure as demand for 5G network equipment slows in North America and Europe. The company's core business—supplying base stations and radio access networks—has seen revenues drop after major carriers cut back on investments. Yet, despite these challenges, Nokia is pushing into new areas like cloud-native solutions and undersea cables to secure future growth.
The slowdown in 5G expansion has hit Nokia hard. After a peak in global rollouts between 2024 and 2025, carriers like Verizon and AT&T have paused further network investments. This pullback has left suppliers with excess capacity and shrinking margins, particularly in North America, where high fixed costs and pricing competition are squeezing profits.
Nokia remains a key supplier for major US carriers, including T-Mobile, AT&T, and Verizon. In recent spectrum auctions, the company secured deals for C-band radios—over 10,000 units for T-Mobile by 2026—doubling prior 5G capacity. It also won contracts for mmWave upgrades with Verizon, set to begin in early 2026, outperforming AT&T's earlier 4G-to-5G transition speeds by 20%. To counter the downturn, Nokia is expanding beyond traditional networks. Its *Network as Code* initiative, backed by partnerships with Google Cloud and Microsoft Azure, offers cloud-native solutions to businesses. Meanwhile, its enterprise division is thriving, with double-digit growth in private 5G networks for manufacturing and logistics. The company is also diversifying into undersea cable projects, securing contracts for high-capacity links to the US.
Nokia's shift toward cloud services, private networks, and undersea infrastructure comes as its legacy 5G business faces declining demand. The company's recent spectrum wins and enterprise growth provide some stability, but its long-term success will depend on adapting to a changing market. With carriers scaling back investments, Nokia must now rely on innovation and diversification to maintain momentum.
