Nokia announced a major leadership change on Monday, revealing that it would replace its current CEO, Pekka Lundmark, with Justin Hotard, an executive from Intel specializing in artificial intelligence. Hotard, who currently oversees AI at Intel, will take over on April 1, 2025, following Lundmark’s departure on March 31.
Lundmark, 61, who has been at the helm of Nokia since 2020, said he plans to transition away from executive roles to focus on board-level positions. Reflecting on his tenure, Lundmark highlighted his time with Nokia as being transformative but indicated a desire to explore new professional avenues. He has held various leadership roles in publicly listed companies for nearly two decades.
The timing of this shift comes on the heels of Nokia’s strong financial performance. The company recently reported an 89% rise in net profit for 2024, a significant rebound after years of weak demand for its 5G equipment. This growth was driven by a surge in sales in North America and India.
Hotard’s appointment signals Nokia’s strategic shift toward capitalizing on the booming AI sector. Hotard, born in 1974, brings over 25 years of leadership experience from top technology companies, including Hewlett Packard, in addition to his role at Intel. He expressed enthusiasm about continuing Nokia’s transformation and expanding its growth opportunities. “Networks are the backbone that power society and businesses, and enable generational technology shifts like the one we are currently experiencing in AI,” Hotard said.
Nokia’s chairwoman, Sari Baldauf, emphasized that Hotard’s deep expertise in AI and data center markets would be crucial to the company’s future growth. She also noted his familiarity with the US market, which is a key focus for Nokia.
The appointment comes at a critical moment for the company. After years of declining 5G sales, especially in North America, Nokia has focused on rebuilding its position in network infrastructure, AI, and data center markets. Analyst Atte Riikola of Finnish market research firm Inderes pointed out that Hotard’s background aligns well with Nokia’s evolving strategy, noting that long-term growth prospects in mobile networks appeared modest compared to the potential in network infrastructure and AI.
Under Lundmark’s leadership, Nokia successfully re-established its technology leadership in 5G radio networks and built a strong position in cloud-native core networks. Despite recent successes, Nokia had to announce plans to cut up to 14,000 jobs in 2023 as demand for 5G equipment remained weak in certain markets.
Nokia’s share price rose 2% to €4.76 ($4.92) on Monday, reflecting investor confidence in the company’s future direction. When Lundmark took over as CEO in 2020, the company’s share price was around €4, signaling a period of significant challenge for the company. Despite those challenges, Lundmark’s leadership has helped stabilize Nokia’s operations in a tough market.
Baldauf praised Lundmark for his contributions, acknowledging the difficult circumstances he inherited and leaving the company “with our highest respect.”
