Press release
Nokia announces major expansion of advanced US semiconductor testing and packaging in Pennsylvania to fuel AI growth
- Nokia is expanding its US-based advanced testing and packaging operations, which are critical to the production of photonic chips that will power AI-native networks, with lower energy consumption and greater operational efficiency.
- Investments will strengthen U.S. domestic production of critical optical networking technologies that power AI infrastructure.
- The announcement is part of Nokia’s multi-year plan to invest $4 billion in US R&D and manufacturing for AI-ready network connectivity.
June 16, 2026
Allentown, Pennsylvania – Nokia today announced a major expansion of its advanced testing and packaging (ATP) operations in Allentown, Pennsylvania. The investment will increase domestic production capacity of the optical networking technologies that enable scalable AI infrastructure connectivity in the United States. The expansion is expected to nearly double Nokia’s workforce in Pennsylvania to more than 500 jobs in engineering, manufacturing and R&D, while generating an expected economic impact of more than $500 million over the next five years.
Today, less than two percent of global semiconductor ATP takes place in the US. Nokia’s Allentown factory is one of only a few in the US that supplies ATP from photonic chips into optical modules for use in AI and telecom infrastructure. Through investments in new production equipment and an expanded manufacturing footprint, Nokia will increase the site’s production capacity to ten times current levels, with new capacity expected to be commercially available by the end of the third quarter.
Nokia’s optical technologies provide advanced connectivity solutions for telecom networks to enable AI infrastructure and can reduce energy consumption by as much as 75 percent. Nokia’s investments result in domestic production of components used in AI infrastructure, create new jobs and significantly reduce energy consumption in AI communications.
“The AI supercycle is fundamentally reshaping network and infrastructure requirements in the U.S. and globally. Our expansion in Allentown is a direct investment in that future: scaling domestic production of the optical networking technologies that power AI infrastructure. It also reflects the strong partnership between Nokia, the United States and the Commonwealth of Pennsylvania to support advanced manufacturing, create jobs, and strengthen U.S. technology leadership and global competitiveness,” said Justin Hotard, president and CEO of Nokia.
“Nokia is doubling down on operations in the Lehigh Valley and ensuring the future of chip manufacturing continues to flow through this region as we have made smart investments to make Pennsylvania more competitive and proven that our Commonwealth is a great place to do business,” said Governor Shapiro. “As demand for semiconductors continues to grow across all industries, we will continue to position Pennsylvania as an innovation leader, with a supportive, thriving business environment that helps companies compete on a global scale. From advanced manufacturing to the research and development of new technology such as advanced chip packaging, Pennsylvania has all the resources to be a global leader in chip manufacturing.”
“This is great news for Pennsylvania. Nokia is doubling its local workforce to more than 500 high-paying jobs in engineering, manufacturing and R&D, while expanding our ability 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 the way in innovation while smartly managing our resources.”
“Nokia’s investment in Pennsylvania directly advances U.S. leadership in AI,” he said Bill Frauenhofer, Executive Director of Semiconductor Investment and Innovation at the Department of Commerce. “Supported by CHIPS and Science Act funding, Nokia is deepening its commitment to innovation and photonic chip manufacturing in the United States. This project will enable critical optical technology and strengthen the U.S. semiconductor supply chain.”
“Nokia’s latest investment is further evidence that the Lehigh Valley is becoming a global leader in advanced manufacturing,” said US Congressman Ryan Mackenzie. “With the help of our unparalleled, highly skilled workforce, Nokia’s local expansion will help our region continue to drive innovation and develop the tools behind next-generation technologies. Congratulations to Nokia and the hundreds of local employees who will benefit from this investment.”
The investment includes approximately $30 million from Nokia, including bipartisan support of approximately $4 million in assistance from the state of Pennsylvania and approximately $10 million in federal CHIPS investment tax credits. This expansion is part of Nokia’s multi-year plan to invest $4 billion in US R&D and manufacturing for AI-ready network connectivity. It is designed to strengthen domestic supply chains for critical communications infrastructure, strengthen U.S. leadership in the technologies shaping the global AI economy, and solidify Pennsylvania’s growing role as a hub for advanced manufacturing, telecommunications technology and AI infrastructure.
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