The expansion is expected to nearly double Nokia's workforce in Pennsylvania to over 500 jobs in engineering, manufacturing and R&D, while generating an estimated economic impact of more than $500 million over the next five years.
Currently, less than 2% of global semiconductor ATP operations are conducted in the US. Nokia's Allentown facility is one of the few in the US offering ATP services for integrating photonic chips into optical modules for AI and telecommunications infrastructure.
By investing in new manufacturing equipment and expanding its industrial footprint, Nokia is increasing the plant's production capacity tenfold compared to its current level; the new capacity is expected to be commercially available by the end of the third quarter.
Nokia's optical technologies provide advanced connectivity solutions for telecommunications networks, enabling AI infrastructure and potentially reducing energy consumption by up to 75%. Nokia's investment fosters domestic manufacturing of components used in AI infrastructure, creates new jobs, and significantly reduces energy consumption in AI communications.
“The AI supercycle is radically transforming network and infrastructure requirements in the U.S. and globally. Our expansion in Allentown is a direct investment in that future: expanding domestic manufacturing of the optical networking technologies that power AI infrastructure. It also reflects the strong collaboration between Nokia, the United States, and the State of Pennsylvania to support advanced manufacturing, create jobs, and strengthen U.S. technological leadership and global competitiveness,” said Justin Hotard, president and CEO of Nokia.
"Nokia is doubling down on its commitment to the Lehigh Valley and ensuring that the future of chip production continues to be in this region, as we have made smart investments to make Pennsylvania more competitive and have shown that our state is an ideal place to do business," said Governor Shapiro.
“As demand for semiconductors continues to grow across all sectors, we will continue to position Pennsylvania as a leader in innovation, with a thriving and enabling business climate that helps companies compete globally. From advanced manufacturing to research and development of new technologies, such as advanced chip packaging, Pennsylvania has all the resources to be a world leader in chip production.” “This is great news for Pennsylvania. Nokia will double its local workforce to over 500 well-paying jobs in engineering, manufacturing, and R&D, while expanding our capacity to domestically produce the critical technologies that power AI infrastructure. This is important for both our economy and our national security,” said Senator Dave McCormick.
“These technologies also help reduce energy consumption in AI communications, demonstrating that we can lead innovation while also managing our resources intelligently.” “Nokia’s investment in Pennsylvania directly advances America’s leadership in AI,” said Bill Frauenhofer, executive director of Semiconductor Investment and Innovation at the Department of Commerce.
“With funding from the CHIPS and Science Acts, Nokia is reinforcing its commitment to innovation and the production of photonic chips in the United States. This project enables critical optical technology and strengthens the U.S. semiconductor supply chain.” “Nokia’s latest investment is further proof that the Lehigh Valley is becoming a global leader in advanced manufacturing,” said U.S. Congressman Ryan Mackenzie.
The investment includes approximately $30 million from Nokia, supported by bipartisan funding of about $4 million in aid from the state of Pennsylvania and about $10 million in federal investment tax credits under the CHIPS Act. This expansion is part of Nokia's multi-year plan to invest $4 billion in US R&D and manufacturing to develop AI-ready network connectivity.
It is designed to strengthen national supply chains for critical communications infrastructure, consolidate U.S. leadership in technologies shaping the global AI economy, and solidify Pennsylvania's increasingly important role as a hub for advanced manufacturing, telecommunications technology, and AI infrastructure.
