Nokia has a plan to reverse its RAN revenue share trajectory, and NVIDIA is now a major part of the plan. What does this mean for the RAN market? After an intense month of updates at GTC and Nokia’s CMD, the timing is right to review the scope of the Nokia and NVIDIA announcements, any RAN implications from the NVIDIA/Nokia partnership, and Nokia’s RAN strategy.
A quick recap about NVIDIA’s entry into RAN. Our understanding based on the announcement and discussion is that NVIDIA will invest $1 B in Nokia and add NVIDIA-powered AI-RAN products to Nokia’s RAN portfolio starting in 2027 (trials in 2026). While the RAN compute (< half of the $30 B+ RAN revenue) is a negligible portion of NVIDIA’s $4+ trillion market cap, the upside is moving the needle when we assess NVIDIA’s broader telco ambitions relative to its $165 B TTM revenue.
Perhaps more importantly, both Nokia and NVIDIA appear aligned when it comes to the role the telco network and assets will play as we move deeper into the AI era. Both companies believe that AI will transform society with robots, self-driving cars, humanoids, and digital twins for manufacturing, among other things. NVIDIA envisions a future where everything that moves will be autonomous. But to do this, the network needs to be transformed from a connectivity pipe into a distributed computing platform serving as an AI grid.
Since this is not NVIDIA’s first attempt at entering the RAN market, it is worth noting that one difference relative to its previous efforts is the more pragmatic approach. Nokia is well aware of its customers’ risk profile— operators can’t justify the ROI based on what they don’t know. So, the goal this time is performance, power, and TCO parity with its existing RAN. Multi-tenancy and new revenue streams are, of course, a nice bonus but not a requirement—the ROI needs to be justified in RAN-only mode.
Given the size of Nokia’s 1 M+ BTS installed base, there are currently three high-level paths to transition towards NVIDIA’s GPU/AI-RAN, listed here in order of importance/projected shares: 1) Purpose-built D-RAN (add card into existing AirScale slots), 2) D-RAN vRAN (COTS at cell site), 3) C-RAN vRAN (centralized COTS).
Taking into consideration that the RAN market, including both baseband and radio, is worth $30+ B and suppliers ship 1 to 2 M macros per year, clearly, there is not much room for the carriers to spend $10+ K on a GPU, even if the software model could unlock more gains down the road. NVIDIA and Nokia will likely share more details about the performance and price points soon. For now, NVIDIA has clarified that the GPU optimized for D-RAN will have a similar price point to the ARC-Compact (2x the capacity). Nokia is targeting more margin improvements—announcing during its CMD that gross margin target for the new mobile infrastructure BU is 48% to 50% by 2028, up from the previous target of 48% for the 4Q24-3Q25 period.
If the TCO and performance-per-watt gap with custom silicon continues to narrow, this partnership could have meaningful implications across multiple RAN domains. Beyond strengthening Nokia’s financial position, it also provides a boost to both the AI-RAN and Cloud-RAN movements. While the AI-RAN train had already left the station—and was expected to scale significantly in the second half of the 5G cycle, even before this partnership announcement—Nokia’s decision to lean further into GPUs will reinforce this trend.
Since the D-RAN option using empty AirScale slots is expected to dominate over the near-term, it is unlikely that this partnership will have any major impact on the C-RAN vs. D-RAN splits, Open RAN, or the growth prospects for multi-tenancy RAN. The shift towards GPUs is also unlikely to impact the 6G trajectory.
But it can impact the vendor dynamics. Nokia remains optimistic it can reverse its RAN share trajectory, which has been trending downward over an extended period until recently. During its November 2025 CMD, Nokia outlined its plans to stabilize the RAN business in the near term and position itself for long-term growth. As we have pointed out in our quarterly RAN coverage, the RAN market is becoming more concentrated and divided. Vendors need to figure out how to maximize the likelihood of winning and balance the tradeoffs.
Rather than chasing volume in markets that are open to all suppliers, Nokia intends to be disciplined and focus on areas where it can differentiate and unlock value—particularly through software and its recently announced partnership with NVIDIA. Nokia sees meaningful opportunities to capture incremental share in North America, Europe, India, and select APAC markets. It is already off to a good start—we estimate Nokia’s 1Q25-3Q25 RAN revenue share outside of North America improved slightly relative to 2024. After the stabilization phase, Nokia is betting that its investments will pay off and the vendor will be in a position to lead with AI-native networks and 6G.
In other words, the goal is to achieve stability in the near term and growth over the long term. It is now up to Nokia and NVIDIA to execute.
