Nokia is investing $30 million to dramatically expand its photonic-semiconductor operations in the Allentown area, a move expected to add more than 250 jobs over three years and nearly double the company's Pennsylvania workforce to over 500, and to help return the Lehigh Valley to a chipmaking role it pioneered more than 70 years ago.
Gov. Josh Shapiro announced the investment on June 16, 2026, framing the region as an emerging national hub for advanced chip production. “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,” Shapiro said.
What Nokia Is Building
The project expands Nokia's photonic-semiconductor advanced test and packaging (ATP) operations in Lehigh County by up to ten times their current capacity. ATP refers to the final, precision stages of chipmaking, where finished semiconductors are tested and packaged for use. The chips made here are photonic, they move information as pulses of light rather than electrical signals, forming the backbone of fiber-optic networks and, increasingly, the ultra-fast connections inside the data centers that run artificial intelligence.
To accommodate the growth, Nokia has leased additional space nearby for product development and logistics. State officials underscored the strategic stakes: less than 2% of the world's semiconductor ATP capacity currently sits in the United States, leaving the domestic supply chain heavily dependent on overseas facilities.
Jobs and Economic Impact
The expansion is expected to create more than 250 new jobs over three years in engineering, manufacturing and research and development, while retaining 308 existing full-time positions. Together, that would nearly double Nokia's Pennsylvania workforce to more than 500. The Commonwealth projects the project will generate over $500 million in economic impact over five years.
The AI Connection
Nokia has tied the expansion directly to the explosion in artificial-intelligence computing, which depends on enormous amounts of high-speed optical networking to shuttle data between servers and data centers. “This investment increases domestic production of the critical optical networking technologies that power AI infrastructure,” said Nokia CEO Justin Hotard.
Not the Nokia of Snake and the 3310
If the name conjures memories of an indestructible 3310 and late-night rounds of Snake, that’s the same Nokia, but a radically reinvented one. The Finnish company that dominated mobile phones in the late 1990s and 2000s exited the consumer handset business in 2014, selling its phone division to Microsoft, and rebuilt itself around telecommunications networks and infrastructure. Today’s Nokia makes the equipment that carries the internet, and, increasingly, the photonic chips at the center of its Allentown expansion. (The Nokia-branded phones still sold today are made by a separate company, HMD Global, under a brand license.)
Part of a $4 Billion U.S. Bet
The Allentown expansion is one piece of a much larger push. In late 2025, Nokia announced plans to invest $4 billion in U.S. research and manufacturing, roughly $3.5 billion for research and development and $500 million for manufacturing at sites in Pennsylvania, Texas and New Jersey, to build out AI-ready networking technology. That commitment came on top of the roughly $2.3 billion in U.S. manufacturing, R&D and AI connectivity Nokia gained through its acquisition of Infinera.
From Infinera, and Back to the Valley's Chip Roots
The Allentown-area ATP operation traces its recent history to Infinera, an optical-networking specialist with deep expertise in photonic integrated circuits and coherent optical technology. Nokia completed its acquisition of Infinera in February 2025, and the Lehigh Valley site has since become a foundational anchor of the company's U.S. semiconductor footprint.
But the region's chipmaking story runs far deeper. It was at Western Electric's Allentown plant that transistors, the forerunners of modern semiconductors, were first mass-produced in 1951, earning the area a reputation as “Silicon Valley East.” That operation passed through a long line of corporate owners, from AT&T Microelectronics to Lucent, Agere and eventually Broadcom, before much of the industry's manufacturing moved overseas. Nokia's investment lands as something of a homecoming for advanced electronics in the Valley.
State and Federal Support
To help land the project, the Pennsylvania Department of Community and Economic Development offered Nokia a $3.2 million Pennsylvania First grant, and the company is eligible for at least $129,500 through the state's Manufacturing Tax Credit Program. The investment is also expected to draw roughly $10 million in federal CHIPS funds.
Why It Matters in the Lehigh Valley
The expansion adds a high-tech manufacturing pillar to a Lehigh Valley economy that has been drawing major capital investment, from Eli Lilly's planned $3.5 billion pharmaceutical campus to medical-device growth at B. Braun. For a region once defined by cement and steel, and once a national leader in semiconductors, reclaiming a piece of the global chip supply chain, aimed squarely at the AI era, marks a striking turn in what the Valley makes.
Nokia's Lehigh Valley Expansion at a Glance
Investment: $30 million by Nokia (part of a broader $4 billion U.S. R&D and manufacturing plan)
Jobs: 250+ new over three years; 308 retained; PA workforce nearly doubling to 500+
What: Up to 10x expansion of photonic-semiconductor advanced test and packaging (ATP) in Lehigh County
Economic impact: $500 million+ projected over five years
Support: $3.2M PA First grant; $129,500+ Manufacturing Tax Credit; ~$10M federal CHIPS funds
Legacy: Allentown mass-produced the first transistors in 1951, once known as “Silicon Valley East”
Announced: June 16, 2026, by Gov. Josh Shapiro
