Nokia just dropped a meaningful structural signal for the optical / AI infrastructure chain.
A 10x expansion of its photonic chip facility in Allentown, PA, with capacity targeted to be online by Q3 2026, isn't just incremental—it's a step-function in US-based optical manufacturing capacity. With less than 2% of advanced semiconductor test/packaging currently onshore, this move places Nokia into a very small strategic group tied directly to AI datacenter buildouts.
Yet the market is still valuing it like a legacy telecom name at around 3.4x forward revenue, while peers such as $Ciena(CIEN)$ (~11.0x) and $COHERENT(COHR)$ (~11.6x), already priced as AI optical beneficiaries serving the same end customers, trade at significantly higher multiples.
The disconnect is largely mix-based—optical still represents a smaller percentage of $Nokia Oyj(NOK)$ revenue. However, capacity expansion plus SOTP logic should start to re-rate that mix over time.
This is how optical exposure gets repriced—quietly, then all at once.
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