Former rubber-boot maker Nokia has swapped brick-like phones for AI data-centre plumbing.
According to the Wall Street Journal, the Finnish outfit no longer makes phones. It has shifted into supplying critical infrastructure for the data centres feeding the artificial intelligence boom, and its shares have taken off.
Nokia sells equipment and software that works like a logistics system for AI. That includes switches that link servers and routers that steer data traffic between them.
If a data centre’s thousands of miles of fibre cables are the roads, Nokia’s kit is the trucks and sorting centres moving the data about.
In a statement, Nokia chief executive Justin Hotard called Nokia’s offerings “the backbone of the AI economy.”
The company is catching the wave as hyperscalers such as OpenAI, Meta Platforms and Google parent Alphabet rush to build data centres.
Nokia’s stock has risen roughly 90 per cent so far this year as investors buy into its new AI infrastructure identity, with a stagnant legacy mobile business still bolted on.
That strategy exposes Nokia to the risks of a volatile sector and the supply-chain squeeze of a crowded market.
Recon Analytics analyst and director Daryl Schoolar said Nokia’s stock is “basking in the glow of the AI halo.” However, its momentum “relies on the success of AI itself—which is not 100% guaranteed.”
Nokia’s former chief executive, Pekka Lundmark, shaped the AI infrastructure strategy by writing a cheque for the optical networking technology maker Infinera in a deal worth $2.3 billion.
Infinera makes the lasers, receivers and chips that shift data around. The deal gave Nokia a much bigger place in optical networking.
Omdia research director Ian Redpath said Nokia’s share of the North American optical network market grew to 27.3 per cent in 2025 from 6.3 per cent in 2024.
That put Nokia solidly in second place. Redpath said Ciena leads with 50.1 per cent market share.
Corporate shape-shifting is hardly new for Nokia. It began as a groundwood pulp mill on Finland’s Nokianvirta River in 1865, then moved into rubber and cables before becoming famous for mobile handsets.
Its market capitalisation peaked at more than $250 billion during the dotcom bubble in 2000.
Nokia sold its handset business to Microsoft in 2014 and still licenses the name to a phone maker. It then leaned into mobile infrastructure, selling kits for cell towers and software for mobile networks.
Those blocky handsets were everywhere in the 1990s and early 2000s. The mobile infrastructure business still provides a little more than half of Nokia’s revenue.
That unit has been shrinking since mobile carriers largely finished their fifth-generation network deployments.
