This move places Nokia as the second-largest, with Huawei remaining the market leader, maintaining a strong position despite the lack of significant competition from Western firms in China
Nokia is poised to receive unconditional approval from the European Union for its $2.3 billion acquisition of Infinera, a leading US-based optical semiconductor and networking equipment manufacturer. Sources with direct knowledge of the matter have reportedly stated that the deal is poised to pass EU regulatory checks without any restrictions, clearing the way for Nokia to strengthen its market position.
Announced in June 2024, the acquisition will enable Nokia to secure the second-largest share in the global optical networking market, with a 20% stake. This move puts the Finnish company behind Huawei, the dominant player, which continues to hold a strong market position despite limited competition from Western firms in China.
Strengthening data center capabilities
The acquisition will expand Nokia’s ability to provide networking solutions to leading tech companies like Amazon, Alphabet, and Microsoft, which are investing billions of dollars into building new data centers to accommodate the growing demands of artificial intelligence (AI).
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Infinera holds a leadership position in intra-data center communications, facilitating server-to-server communication within data centers. Approximately 60% of its business is derived from US clients. As the deal undergoes its final stages, the European Commission is set to conclude its preliminary review by February 26.
In a statement released on January 30, Nokia reaffirmed that it expects to finalize the acquisition in the first quarter of 2025. This acquisition underscores Nokia’s strategy to enhance its optical solutions portfolio and expand its reach in the fast-evolving AI-driven data center market.
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