Nokia investing $30 million to expand semiconductor operations in Allentown

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The Lehigh Valley‘s tech sector just keeps growing. 

On Tuesday, Nokia of America Corp. announced that it will be investing $30 million to increase its photonic semiconductor advanced test and packaging manufacturing capacity at its Allentown operations.  

Nokia’s Allentown facility was acquired from Infinera, which established the optical engineering hub back in 2020.  

The expansion is expected to increase production 10 times its current level and add more than 250 new high-paying technical jobs to the region. 

Best known as a mobile phone manufacturer, Nokia now specializes in other communications technology.  

 U.S. Nokia’s Allentown facility is one of only a few in the U.S. providing ATP of photonic chips into optical modules for use in AI and telecom infrastructure.  

Nokia President and CEO Justin Hotard, said the investment will increase domestic production capacity of the optical networking technologies that power scalable AI infrastructure connectivity across the United States. 

And while there has been a great deal of pushback over AI data centers, Hotard said this technology actually helps address one of the biggest concerns about such data centers – their size and energy usage. 

“This technology allows data centers to be interconnected and to be more efficient,” Hotard said. 

He explained that by enabling the interconnection of smaller data centers, it replaces the need for larger data centers. 

“This means we can do things that are more responsible,” he said. 

Nokia’s optical technologies can reduce AI infrastructure energy usage by as much as 75 percent. 

“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 manufacturing 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,” Hotard said. 

He noted that in addition to the $30 million Nokia is investing in the expansion was bolstered by more than $3 million in support from the state and $10 million in federal CHIPS funds. 

Pennsylvania Gov. Josh Shapiro said that the Finland-based tech company could have invested in operations anywhere in the world but chose Allentown. 

“Nokia is doubling down on the Lehigh Valley and ensuring that the future of chip production continues to run through this region because we’ve made smart investments to make Pennsylvania more competitive and proven that our commonwealth is a great place to do business,” said Shapiro. “As demand for semiconductors continues to grow across industries, we’ll continue to position Pennsylvania as a leader in innovation, with a supportive, thriving business climate that helps companies compete on a global scale.” 

Shapiro noted that more than 80% of all chip manufacturing is done in Asia, by building semiconductor manufacturing in the U.S. it strengthens the nation’s economy and security.