Nokia Stock: How the AI Supercycle and NVIDIA’s Investment Could Rewire Its Future -( $NOK $NVDA $SPY )

Telecom is suddenly the belle of the AI ball, and Nokia (NOK) has found itself back in Wall Street’s good graces by selling the one thing every model, agent and chatbot secretly craves: bandwidth and low latency, not brand awareness. As the so‑called AI supercycle gathers steam, the company is recasting itself as the Western backbone of intelligence-era networks, and NVIDIA’s (NVDA) new billion‑dollar stake suggests Silicon Valley intends to ride on its shoulders rather than build all the pipes itself.

The AI supercycle needs bigger pipes

A new cross‑industry study tied to Nokia highlights a rare consensus: US and European networks are not yet ready for the tidal wave of AI traffic heading their way. Data centers are scaling like it is the late‑1990s all over again, but this time the traffic is less cat videos and more token streams and agentic workflows that punish every millisecond of latency. In this framing, “AI supercycle” is less a buzzword than a capital expenditure forecast: trillions of parameters demand trillions of euros and dollars in optical, IP and mobile infrastructure to keep them moving.

Nokia’s reinvention around AI

To capture that demand, Nokia is simplifying itself into two big engines: Network Infrastructure, covering optical, IP and fixed networks, and Mobile Infrastructure, spanning radio, core software and standards. Management has sketched an ambition to lift comparable operating profit into the EUR 2.7–3.2 billion range by 2028, effectively betting that being the “AI plumbing champion” can be just as lucrative as being the chip supplier. The new strategy puts five phrases on repeat—AI, cloud, 6G, co‑innovation and capital discipline—signaling to investors that the company is trading its old handset nostalgia for a harder‑edged infrastructure story.

NVIDIA buys into the network

Enter NVIDIA, which has spent years selling GPUs to the data‑center end of the AI boom and now wants the radio side of the story as well. The chipmaker is investing roughly 1 billion dollars into newly issued Nokia shares at about 6.01 euros per share, tying the financing directly to a strategic push on AI‑native 5G‑Advanced and 6G networks. Under the partnership, Nokia will tune its RAN software for NVIDIA’s CUDA platform and a new 6G‑ready “Arc Aerial” telecom compute system, with the goal of turning tomorrow’s base stations into something that looks suspiciously like small AI data centers at the edge.

From internet boom to AI era

Justin Hotard, Nokia’s CEO, has taken to describing the AI build‑out as the spiritual sequel to the internet boom of the 1990s, only this time the traffic patterns are more demanding and the tolerance for downtime is close to zero. The company is rolling out new 7220 IXR data‑center switches and AI‑driven operations tools aimed at cutting outages and supporting gigantic AI “factories” that can scale to hundreds of thousands of accelerators. For investors who once viewed Nokia as a trivia answer (“Who made your first phone?”), the emerging pitch is cleaner: in the AI supercycle, NVIDIA may light up the brains, but Nokia plans to own the circulatory system—and in this market, selling shovels in a gold rush has rarely gone out of style.

The Sources

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