Nokia Oyj vs. AT&T: Which Technology Stock Is a Better Buy in 2026?

The telecommunications landscape is shifting as 5G matures and fiber expansion continues. Deciding between Nokia Oyj (NYSE:NOK) and AT&T (NYSE:T) requires choosing between global network infrastructure and domestic consumer service delivery.

Nokia focuses on the technical hardware and software that power global connectivity. AT&T serves as the direct provider of wireless and broadband services to millions of individuals. Both companies play critical roles in the digital economy, yet they offer distinct financial structures and risk profiles for long-term investors to consider.

The case for Nokia Oyj

Nokia builds networks across mobile, IP, and optical systems. It serves communication providers and large enterprises in about 130 countries. The company relies on its infrastructure expertise to help global clients manage rising data demands. Nokia does not disclose specific major customers in its regulatory filings, but its global footprint makes it a key partner for many national carriers.

In FY 2025, revenue reached nearly $22.7 billion, representing a growth of roughly 3.5% over the previous year. The company reported a net income of approximately $742.1 million. This net margin, which is the percentage of revenue remaining after all expenses are paid, sat at nearly 3.3% for the fiscal period.

As of its December 2025 balance sheet, the debt-to-equity ratio is approximately 0.2x. This ratio compares total debt to shareholders' equity, suggesting a conservative use of borrowed money. The current ratio, which measures the ability to cover short-term debts with assets like cash, is nearly 1.6x. Free cash flow, which is the cash remaining after the company pays for property and equipment upgrades, reached roughly $1.7 billion for the year.

The case for AT&T

AT&T is a giant among communication stocks, serving 145 million wireless subscribers in North America. Its primary focus is on high-speed wireless and fiber-optic broadband services. The company reports that no single customer accounted for 10% or more of revenue in 2025, which reduces the risk of relying on any one client.

In FY 2025, revenue reached approximately $125.6 billion, representing nearly 2.7% growth over the prior year. The company achieved a net income of roughly $21.9 billion. This resulted in a net margin of close to 17.4%, the portion of total sales converted into profit after all costs are accounted for.

As of its December 2025 balance sheet, the debt-to-equity ratio is approximately 1.6x. This indicates the company uses more debt relative to its equity to fund its massive infrastructure. The current ratio is roughly 0.9x, meaning its short-term liabilities are slightly higher than its liquid assets. Free cash flow for the year was nearly $19.4 billion.

Risk profile comparison

Nokia faces intense pressure in a cyclical industry where spending by major carriers can fluctuate significantly. Competitors in the equipment space often engage in price wars to win long-term contracts. Furthermore, the company must constantly innovate to keep up with rapid changes in wireless technology and evolving global standards. These shifts can make research and development costs difficult to manage if revenue growth slows.

AT&T faces significant competition from other national wireless providers and regional operators, such as EchoStar (NASDAQ:ECHO). This intensity can lead to pricing pressure or customers switching to other brands. The company also faces regulatory oversight and potential disruptions in the supply chain of essential semiconductors. Additionally, labor relations pose a risk as roughly 43% of its workforce is unionized, making future contract negotiations a factor for operations.

Valuation comparison

AT&T appears more affordable based on its lower multiples, while Nokia trades at a higher premium relative to its future earnings estimates and sales over the past twelve months.

Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.

Which stock would I buy in 2026?

To compare AT&T and Nokia Oyj, investors should consider a few key factors. Let's have a look at them and see what that tells us about each stock.

To begin, there's valuation. AT&T boasts a very reasonable forward P/E of only 10.9x and a P/S ratio of 1.4x. Nokia, meanwhile, has a forward P/E more than twice that of AT&T at 26.5x. Its P/S ratio is also nearly twice as high at 2.4x. Therefore, on this front, AT&T has an edge.

Two other factors worth considering are profitability and income potential. AT&T has averaged an operating margin of 19.7% over the last five years. Its current operating margin stands at about 21.2%. Meanwhile, Nokia has averaged an operating margin of only 9.9%; its current operating margin is around 11.1%. As for income, AT&T boasts a dividend yield of 4.5%, offering solid cash payments for income-oriented investors. Nokia has a dividend yield of 1.6%, offering a more modest amount of cash flow.

One final factor to weigh is debt. AT&T's balance sheet holds a large amount of debt. The company has over $146 billion in net debt. That's down significantly from a high of $197 billion four years ago. Nonetheless, it is an albatross the company must manage as interest rates continue to rise. Nokia, on the other hand, has no net debt.

In summary, AT&T and Nokia Oyj are quite different. AT&T is more of a pure-play telecom stock, combining its wireless network with its fiber broadband services. Nokia, by contrast, has shifted its strategy. It has now pivoted to providing services to AI and Cloud customers. Granted, most of AT&T's fundamentals are more appealing right now (aside from its net load), but, going forward, Nokia is well-positioned to benefit from the AI infrastructure build-out. Therefore, growth-oriented investors will likely favor Nokia, while value- or income-oriented investors will likely be drawn to AT&T.

Jake Lerch has positions in AT&T. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.