Finnish telecom equipment maker Nokia posted quarterly profits that exceeded market expectations, boosted by rising demand from AI and cloud computing companies, despite ongoing pressures from higher memory chip prices.

The company announced on Thursday that its adjusted operating profit rose 18 percent in the second quarter of 2026 to 434 million euros ($496.1 million), beating the average analyst estimate of 382 million euros.

Adjusted net sales also reached 4.82 billion euros in the quarter, exceeding market expectations.

Nokia continues to direct its investments toward supplying major technology companies with the fiber optics needed to build AI data centers, amid growing demand for digital infrastructure.

The company's revenue from AI and cloud computing customers reached 446 million euros in the second quarter, double its level a year earlier, while it secured new orders worth 2.8 billion euros.

CEO Justin Hotard said demand remains strong, but supply constraints are the biggest challenge facing the sector.

He added: "Demand remains strong, while supply remains the biggest constraint facing the industry, prompting our customers to place long-term orders."

In contrast, Nokia was not immune to the rise in memory chip prices, as strong demand from AI companies drove up costs, impacting telecom equipment makers.

Its Swedish competitor Ericsson warned last week that rising memory chip prices, driven by the surge in demand for AI applications, are squeezing profit margins, raising investor concerns and causing the company's stock to fall. "); googletag.cmd.push(function() { onDvtagReady(function () { googletag.display('div-gpt-ad-3341368-4'); }); }); }