US based chipmaker Nvidia has announced a $1 billion investment in Finnish telecom giant Nokia, acquiring a 2.9 per cent ownership stake as part of a sweeping partnership to advance next-generation wireless networks, including 6G, and improved AI driven infrastructure. With this, the company aims to expand its business beyond semiconductors and deeper into the global connectivity and cloud ecosystem.
Under the new agreement, Nokia will issue approximately 166 million new shares to Nvidia in the form of American Depositary Shares. It’s expected to be officially registered in November. With this funding, Nokia hopes to accelerate its transformation strategy by strengthening its position in cloud networking, AI infrastructure, and connectivity solutions designed for the emerging AI supercycle. A significant portion of the funds will be directed to Nokia’s Network Infrastructure division, which has become central to the company’s AI and data centre ambitions.
The partnership extends well beyond the financial transaction.Nvidia and Nokia plan to work jointly on 6G research, AI powered networking and software optimisation for data centres. As per Nokia, discussions are underway for Nvidia to integrate certain Nokia technologies into future projects.
The investment comes at a critical time for Nokia, which is reinventing itself and shifting away from traditional telecom equipment roots towards AI and cloud-based data centre solutions. Nokia’s stock soared more than 20% after the announcement. Previously, the company paid $2.3 billion for US-based Infinera Corp., boosting its presence in high-capacity optical networking and AI data centre connectivity.
The company recently committed up to $100 billion to OpenAI, following a $100 million investment in 2024, and has even formed an unexpected collaboration with Intel to develop AI infrastructure technologies.
While most analysts have praised Nvidia’s aggressive investment strategy, some have drawn parallels to the “circular investment” patterns observed during the early 2000s tech boom, when cross-company funding frequently inflated growth narratives.