Nokia has hired its first CEO from America in a renewed pivot to AI designed to arrest years of low valuations and stagnant revenue growth.
The Finnish telecoms group announced the appointment of Justin Hotard, Intel’s executive vice president in data centers and AI, who will join in April.
“He has a strong track record of accelerating growth in technology companies along with vast expertise in AI and data center markets, which are critical areas for Nokia’s future growth,” said Sari Baldauf, chair of Nokia’s board of directors.
“In his previous positions, and throughout the selection process, he [Hotard] has demonstrated the strategic insight, vision, leadership, and value creation mindset required for a CEO of Nokia.”
The Financial Times reported in September last year that Nokia was searching for a successor to Lundmark, citing people familiar with the matter, amid growing frustration at slow revenue growth and a stagnant share price.
Thanking him for his work, Baldauf acknowledged that Lundmark had “joined at a difficult time in Nokia’s history.”
Lundmark was hired in 2020 to head up Nokia’s 5G expansion efforts. The group was boosted by pressure from Washington on Chinese competitor Huawei, which left it to compete with fellow Scandinavian group Ericsson on new mobile networks.
In October 2023, Nokia announced plans to cut up to 14,000 jobs as part of a cost base “reset” that would cut expenses by up to $1.2 billion over three years.
“The most difficult business decisions to make are the ones that impact our people,” Lundmark said at the time of the layoffs.
Lundmark initiated a leadership change when he informed the board that he would like to consider stepping down from executive roles when the “repositioning of the business was in a more advanced stage,” and when a successor had been found.
“Under his tenure, Nokia has re-established its technology leadership in 5G radio networks and built a strong position in cloud-native core networks,” said Baldauf.
Nokia has been on a soul-searching journey for the last two decades in search of a return to its previous heights as one of Europe’s most valuable companies.
The group is still perhaps best known for its once-market-leading mobile phone business. Nokia is now worth a tenth of its peak $260 billion valuation in 2000, though, after the invention of the iPhone saw it hemorrhage market share.
Since then, its appointments have reflected repeated pivots focused on connectivity. The company also launched a redesigned logo in 2023 aimed at stopping people from associating the brand with its old mobile phone business.
Nokia hired its first non-Finnish CEO, the Canadian former Microsoft exec Stephen Elop, in 2010, leading Nokia to increase its relationship with the Silicon Valley group and to sell its mobile phone unit to the company.
The appointment was regarded as a step away from “the Nokia way,” an informal management structure based on Finnish values, praised during the company’s rise but criticized as too insular when its share price collapsed.
Hotard’s appointment, which seeks to tap AI talent from the leading U.S. Market, will further solidify Nokia’s latest pivot towards the technology and marks a fresh embrace of U.S. Tech capabilities.
“Networks are the backbone that power society and businesses, and enable generational technology shifts like the one we are currently experiencing in AI,” said Hotard. Nokia nearly doubled profits in 2024, partly as a result of its aggressive cost-cutting program.
