Today's Edition
HELSINKI (AFP)
US chip giant Nvidia will take a 2.9 percent stake in Finnish telecoms equipment maker Nokia for $1 billion, Nokia said Tuesday, sending its share price soaring 14 percent.
“Nokia and Nvidia have agreed to collaborate on AI networking solutions and explore opportunities to incorporate Nokia's data center switching and optical technologies into Nvidia's future AI infrastructure architecture,” Nokia said in a statement.
It said it would issue 166,389,351 new shares, for which Nvidia would pay $6.01 per share.
Nvidia's chips will be used to accelerate Nokia's software for 5G and 6G networks and Nvidia will explore ways to use Nokia's data centre technology in its AI infrastructure, they said.
Nokia, best known for selling mobile network parts, has been pushing into data centres - a business that's growing thanks to the growing demand for computing capacity from the artificial intelligence boom. The move has paid off, and helped Nokia beat Wall Street estimates last quarter. The Espoo, Finland-based company earlier this year bought Infinera Corp. for $2.3 billion to expand into networking products for AI data centers.
Chief Executive Officer Justin Hotard is leading a major turnaround of the Nordic company, emphasising its position as the only Western alternative to Huawei Technologies Co. for supplying the entire portfolio of communications kit, from 5G radios to fibre optic cables.
Nvidia has been on a major spending spree in recent months. The company said it will invest as much as $100 billion into OpenAI as well as billions into autonomous vehicle companies Wayve and Oxa, fintech Revolut, and AI companies like PolyAI. The company will also invest half a billion into building a new data centre with Deutsche Telekom AG.
