Nokia CEO Pekka Hotard believes the world is at the beginning of an AI supercycle similar to the internet boom of the 1990s. Speaking to Reuters, he said that even if there is an AI bubble, the long-term outlook remains positive.
“I fundamentally think we’re at the front end of an AI supercycle, much like the 1990s with the internet,” Hotard said. “Even if there’s a bubble or a slowdown, long-term trends are very favourable.”
His comments come as debates grow over whether AI investments are sustainable. A Bank of America survey found that over half of fund managers believe AI stocks are currently in a bubble. Tech leaders like Jeff Bezos and Sam Altman have also warned that hype-driven investments could lead to major financial losses.
Despite these concerns, global demand for data centres continues to surge as companies build infrastructure to power AI systems. Hotard, who previously led Intel’s data centre and AI division, said Nokia is witnessing growth across both large and small tech firms, particularly in Europe.
“Clearly, the new wave of growth is driven by data centres,” he said. “It’s a huge step up in volume.”
Earlier this week, Nokia reported quarterly earnings that exceeded market expectations, supported by strong optical and cloud demand. This included increased sales to AI-based data centres after its acquisition of U.S. networking firm Infinera.
The Finnish telecom giant’s shift toward AI marks its biggest transformation since selling its mobile phone business in 2013. While mobile networks remain central to Nokia’s operations, the company is now integrating AI into areas like radio access and fibre networks.
In September, Nokia formed a dedicated Technology and AI division, led by Chief Technology Officer Pallavi Mahajan, a former Intel executive, to accelerate its AI innovation strategy.
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