Nokia Oyj will replace Chief Executive Officer Pekka Lundmark with Intel Corp.’s recently appointed head of artificial intelligence Justin Hotard in a surprise announcement as the network equipment maker works to exit a prolonged slump in orders from phone operators.

Justin Hotard, Intel’s head of data-center and AI operations, is leaving to head up Nokia. Shares of the telecom-gear maker rallied over 2% in Europe; U.S.-listed Intel shares edged higher premarket.

Nokia (NYSE: NOK) said Monday that Justin Hotard will succeed Pekka Lundmark as the Finnish company's new CEO. Intel hired Hotard as executive vice president and general manager of its data center and artificial intelligence group in January 2024.