Nokia has announced a major expansion of its advanced test and packaging (ATP) operations in Allentown, Pennsylvania, increasing production capacity for optical networking technologies that support AI infrastructure across the United States.
The investment is expected to nearly double Nokia’s workforce to more than 500 employees across engineering, manufacturing and R&D roles, while generating an estimated economic impact of more than US$500 million over the next five years.
Currently, less than 2% of global semiconductor ATP activity takes place in the US. Nokia’s Allentown facility is among a small number of sites providing ATP services for photonic chips integrated into optical modules used in AI and telecommunications infrastructure. Through investment in new equipment and expanded production space, Nokia plans to increase capacity by up to ten times current levels, with additional output expected to be commercially available by the end of the third quarter.
Nokia’s optical technologies deliver connectivity solutions for telecom networks that enable AI infrastructure while reducing energy consumption by as much as 75%. The expansion will support domestic manufacturing, create jobs and improve energy efficiency in AI communications.
Justin Hotard, President and CEO, Nokia, said the AI supercycle is reshaping network and infrastructure requirements globally and that the expansion represents a direct investment in scaling US production of optical networking technologies that power AI systems. Pennsylvania Governor Josh Shapiro said the project strengthens the state’s position in semiconductor manufacturing. Backed by Nokia, assistance and federal CHIPS incentives, the investment will enhance innovation, supply-chain resilience and long-term competitiveness.
