- Nokia’s AI & Cloud business grew 123% year over year
- And its IP Networks business grew 43% year over year
- Nokia’s Mobile Infrastructure, which is its largest revenue-producing business, saw revenues grow 5% during Q3
For its third quarter 2026, Nokia grew net sales by 9% with AI & Cloud again its largest growth engine.
AI & Cloud, IP Networks and Optical Networks are all part of Nokia’s Infrastructure business.
Nokia today highlighted that net sales in AI & Cloud grew 123% year over year and represented 12% of total group net sales in the quarter. Demand from AI & Cloud also drove Nokia’s IP Networks business to grow 43% year over year as previously announced design wins began to convert into revenue. The company’s Optical Networks business grew 18%.
Nokia’s Mobile Infrastructure, which is its largest revenue-producing business, saw revenues grow 5% during Q3.
For 2026 guidance, Nokia said it Optical Networks and IP Networks are on track to grow somewhat above the 18%-20% assumption it provided for the full year. For 2027, it expects these businesses to grow between 25% and 30% on a combined basis.
During the quarter, Nokia completed the sale of its fixed wireless access business to Inseego and signed an agreement to sell its enterprise campus edge business to Aurelius.
Not widely covered is the fact that Nokia is building a wafer fab facility in San Jose, California, through its subsidiary Infinera. The facility will manufacture indium phosphide (InP) photonic integrated circuits, which are used in fiber-optic communications and AI data-center networks.
Nokia CEO Justin Hotard said that 90% of the process development at the fab is done. “Obviously, the key milestone is seeing us enter production by year end and then continuing to see production ramp through next year,” he said.
Nokia is also in the process of buying NXP's Chandler semiconductor fabrication campus in Arizona.
Hotard said today, “What's becoming more and more apparent is that optical penetration and demand is going to continue to increase. It's a factor of the tremendous increase in bandwidth demand that's going to touch every part of the network that we serve today.” He said the fab in Chandler helps position Nokia to support the demand as it emerges. “We think we've got lots of different avenues to monetize that facility through indium phosphide manufacturing,” he said.
Hotard called out some new business with the long-haul provider Zayo. “We are the market leader in telco edge routing, and we have a rich optical portfolio which uniquely positions us to deliver solutions to meet this market need,” he said. "An example of this is helping our customer, Zayo, a major internet backbone provider in the U.S., to create an architecture and service blueprint for connecting distributed inference across data centers for multiple partners.”
Nokia’s mobile business
In terms of its mobile business, Hotard mentioned Nokia's work with Nvidia on AI-RAN. He cited two examples of mobile carriers using the combined solution. “This past weekend, T-Mobile completed their first live voice call over AI-RAN in its production network. In addition, Elisa yesterday announced that they have run voice, mobile data, and AI workloads simultaneously on the same AI-RAN platform in their commercial network,” said Hotard. “In live environments, we've already demonstrated spectral efficiency gains of more than 20%, increasing capacity and improving network economics against our roadmap of 100% improvement in spectral efficiency gains in 2028.”
Read more Nokia stories on Fierce Network:
Nokia and Nvidia keep AI-RAN momentum going as they edge closer to commercial reality
Nokia to sell private 5G ECE unit to Aurelius
Nokia campus sale nears as Hotard bets on industrial AI
Zayo confirms Nvidia as its new ‘monster' customer