Nvidia will pay US$1-billion for a stake of 2.9% in Nokia as part of a deal focused on AI and data centres, the Finnish telecommunications equipment maker said on Tuesday as its shares hit their highest level in nearly a decade.
Nokia said the companies will collaborate on artificial intelligence networking solutions and explore opportunities to include its data centre communications products in Nvidia’s future AI infrastructure plans.
Capital expenditure on data centre infrastructure is expected to exceed US$1.7-trillion by 2030, consulting firm McKinsey estimates, largely because of the expansion of AI. Nvidia has a near-monopoly in supplying AI chips for data centres and has partnered with companies ranging from OpenAI to Microsoft.
Nvidia CEO Jensen Huang said the deal would help make the US the centre of the next revolution in 6G.
“Thank you for helping the United States bring telecommunication technology back to America,” Huang said in a speech in Washington, addressing Nokia CEO Justin Hotard.
“The key thing here is it’s American technology delivering the base capability, which is the accelerated computing stack from Nvidia, now purpose-built for mobile,” Hotard told Reuters in an interview.
He expects the new equipment to start contributing to revenue from 2027 as it goes into commercial deployment, first with 5G, followed by 6G.
“This is a strong endorsement of Nokia’s capabilities,” said PP Foresight analyst Paolo Pescatore, adding: “Next-generation networks, such as 6G, will play a significant role in enabling new AI-powered experiences.”
6G trials
Nokia’s shares closed up 20.9% after the deal announcement, a high last touched in late January 2016.
Since joining Nokia in April, Hotard, who earlier led Intel’s data centres and AI group, has focused on expanding its data centre business.
While Nvidia and Nokia have been talking about the technology since last year, Hotard sped up the discussions. “Jensen and I have been talking for a little bit and I love the pace at which Nvidia moves,” Hotard said. “It’s a pace that I aspire for us to move at Nokia.”
Read: Nvidia bets $100-billion on OpenAI
The non-exclusive partnership and the investment will make Nvidia the second largest shareholder in Nokia.
Nokia, which uses Marvell chips for many of its products, and its Swedish rival Ericsson both make equipment for connectivity inside data centres and between data centres and have been benefiting from increased AI use.
While Nvidia chips are likely to be more expensive, said Mads Rosendal, analyst at Danske Bank Credit Research, the proposed partnership would be mutually beneficial, given Nvidia’s large share in the US data centre market.
Separately, the two companies will also partner with T-Mobile U.S. to develop AI radio technologies for developing 6G and start trials from next year, Nokia said. — Supantha Mukherjee, Johan Ahlander, Louise Rasmussen and Gianluca Lo Nostro, (c) 2025 Reuters
Get breaking news from TechCentral on WhatsApp. Sign up here.
