Nvidia is expanding its AI ambitions beyond chips and servers with a new billion-dollar partnership.
The company announced that it will invest $1 billion in Nokia, taking a nearly 3% stake in the Finnish telecommunications firm to strengthen collaboration on AI-driven networking and data center technologies.
Nokia will issue 166.4 million new shares for Nvidia, which the US company will subscribe to for $6.01 each. This gives Nvidia a 2.9% ownership stake and a direct role in shaping future network technologies. Both companies said the partnership will focus on building faster, more efficient data center connectivity and AI-ready communication systems. For Nokia, the investment offers financial support and a boost in credibility as it continues its pivot from traditional telecom hardware to cloud and AI infrastructure.
Nvidia extends AI into networks
According to Bloomberg, Nvidia’s $1 billion investment marks a major expansion of its AI strategy beyond the chips and GPUs. Nokia, best known for selling mobile network parts, has been pushing into data centers, aiming to process data closer to the users so there’s less lag in sending data. The shift, according to Nokia CEO Justin Hotard, is a “fundamental redesign of the network.”
Nvidia is betting that the next generation of wireless connections, 6G, will be fundamentally shaped by AI. The two companies are collaborating to develop networking gear based on Nvidia’s new software and chip designs specifically built for this emerging market.
Nvidia’s official newsroom announcement said that the partnership will integrate Nvidia’s accelerated computing platforms with Nokia’s network technology to develop AI-enabled communications infrastructure. As Jotard emphasized, “Our partnership with Nvidia, and their investment in Nokia, will accelerate AI-RAN innovation to put an AI data center into everyone’s pocket.”
Nokia gains capital and credibility
As Yahoo Finance noted, Nokia’s stock surged 22.8% following the announcement, propelling the company’s market value to approximately $41.8 billion, the highest level the company has reached in over a decade. Investors viewed the deal as a strong validation of Nokia’s renewed focus on software-driven, cloud-native networks.
Analysts told Reuters, that the partnership provides Nokia with both the funding and credibility needed to accelerate its AI infrastructure strategy. “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.”
Consulting firm McKinsey estimates that capital expenditure on data center infrastructure is expected to exceed $1.7 trillion by 2030, primarily driven by the expansion of AI. Nvidia already holds a near-monopoly in supplying chips for data centers and partners with companies such as OpenAI and Microsoft, making its investment in Nokia a logical step toward linking compute and connectivity layers.
What IT leaders should watch
For IT and network leaders, Nvidia’s investment in Nokia highlights how AI is becoming foundational to telecommunications strategy. As 5G becomes mainstream, networks need to get smarter and faster. Nvidia’s partnership with Nokia shows how AI is shifting from data centers into the network itself, automating performance, improving security, and making systems more efficient.
For CIOs and infrastructure planners, these changes mean the traditional boundary between networking and computing is disappearing. The Nvidia-Nokia partnership may set the tone for what future-ready connectivity looks like, and organizations will need to rethink their infrastructure to support AI workloads that operate across network and computing systems simultaneously.
To learn how enterprises are scaling technology investments in the AI era, read TechRepublic’s analysis of the spending surge.
