Nokia Is Splitting Off Its AI Business, Weeks After $1bn Nvidia Investment

Why It Matters

The restructuring positions Nokia to capitalize on the emerging AI‑driven network market and 6G rollout, leveraging Nvidia’s funding while tightening costs, which could reshape competition in telecom infrastructure and impact investors’ outlook on the sector.

Summary

Nokia announced that, effective Jan. 1, 2026, it will split into two primary segments—Network Infrastructure and Mobile Infrastructure—while spinning off its AI‑focused mobile business to drive AI‑first networks such as 6G. The company targets a 6‑8% net‑sales CAGR through 2028 and aims for 48‑50% gross margin in Mobile Infrastructure, alongside cutting operating expenses from €350 million to €150 million by 2028. The move follows a $1 billion investment from Nvidia earmarked for 6G development, and includes leadership changes with a new Chief Customer Officer and interim oversight of Mobile Infrastructure by CEO Justin Hotard. Nokia’s quarterly revenue rose 12% YoY to €4.83 billion, but its shares have slipped about 7% after a brief November rally.