CNBC International Live Sep 20, 2026
With Justin Hotard, CEO of Nokia
Nokia is winding down almost all of its sites in mainland China, and its chief executive says the business it is leaving behind stopped existing years ago.
The usual argument for staying is Nvidia's: keep selling into the market, keep sight of what is being built there. Justin Hotard is doing the opposite, and his reason is that the decision was made on the other side first.
"China had closed the door on us many years ago"
Justin Hotard, CEO of Nokia, on CNBC International Live, inherited an optical networking business the company had just doubled by acquisition, and he says he cannot take credit for the deal that made it.
The full segment is covered here so you can skip it.
Here are the 4 takeaways that matter.
Key Takeaways
China shut Nokia and its Western peers out years ago, which is why he calls closing the mainland sites "a very simple step"
The technology licensing business stays in China; the engineering does not
The contest he describes is economic, scientific and military, not only a security question
He says China is already deploying physical AI — robots, autonomous cars, EVs — which is why Nokia keeps watching a market it is leaving
A safe AI model running on unreliable infrastructure is still a risk, which is his argument for why connectivity belongs in the security conversation
Infinera is the reason the turnaround worked, giving Nokia a position from complete systems down to the semiconductors inside them
The AI build-out has run "to a far faster pace and higher scale than we expected", and he is spending the proceeds on making the company durable
1. Partner Or Nothing
Hotard opened by pointing at Nokia's own week. Seven days earlier, he said, the conversation would have been about the partnership with Google and Google's investment in Finland, and he used that to describe what the company is now trying to be: a great partner in technology rather than a standalone supplier.
He says no Western company wins this on its own
This is really important because it's impossible for the West to win without thriving healthy ecosystems and partnership.
Justin Hotard
The second half of the strategy is narrower than the first. Nokia is not trying to be present across the technology stack; it is trying to own one layer of it.
The target is one layer: trusted connectivity underneath everything else
Second thing I would emphasize is that, you know, our focus in this stack is being the world's best trusted connectivity infrastructure provider.
Justin Hotard
Then the argument for why that layer is a safety question rather than a plumbing question. A model can be built to be safe and still fail the customer, on his account, if the network under it is not there.
A safe model on unreliable infrastructure is still a risk
And so, when you think about what's, you know, what's top of mind today around safety and security, you know, all of those models can be safe and secure, but if they're not running on trusted infrastructure, if it's not performing, if we're not providing the connectivity that customers need, it's simply going to create more risk or it won't work.
Justin Hotard
2. A Race, Not Just Security
The anchor called Nokia one of the biggest comeback stories in business, then picked up the phrase Hotard had just used, "for the West to win", and asked whether he meant an existential fight with China. He did not soften it. He said he hears the same thing from American chief executives, pointing to Alex Karp, who the show had on the day before, and in quieter form from politicians in the US and in Europe.
He calls it a battle, and says the word is not a figure of speech
But this is a battle and I think it's a race that's important.
Justin Hotard
What Hotard thinks about the China race is that security is the smallest part of it. He named three other things on the table, and the third is new to the European version of the argument.
The stakes are economic, scientific and, in Europe, military
It's also about economic competitiveness, scientific leadership, and of course, as we know in Europe now, it's also about defense.
Justin Hotard
3. China Shut Us Out First
The show put reports to him that Nokia plans to close almost all of its mainland Chinese sites by year end and cut most of the workforce there, set that against Nvidia's effort to keep selling into the country, and asked whether shutting the door costs Nokia sight of what China is building.
Hotard accepted the premise and reversed the sequence. "China had closed the door on us many years ago", he said, meaning Nokia and its Western peers, and that Chinese buyers had made a clear decision not to purchase the technology.
The closures follow the customers, not a strategy change
We have to align our engineering and our resources where we have business. And so, it's a very simple step in that process.
Justin Hotard
Two things survive the exit. Nokia keeps a technology licensing business in China, and it keeps paying attention to what Chinese firms build.
Leaving the market is not the same as ignoring it
That doesn't mean we don't have ongoing business in China. But our technology licensing business continues to engage.
Justin Hotard
He calls China an innovation leader, and that is why he calls it a race
And it doesn't mean that we're not very aware of what China's doing because at the end of the day, China is an innovation leader, and that's why this is a race.
Justin Hotard
The part he says gets missed is not the models. It is physical AI: robots, autonomous cars and electric vehicles. European audiences think he is "being theoretical" when he raises it, he said, and a lot of it is already being deployed and built in China today. That is also where he drew the line on his own decision. With no business in a market, he said, he cannot keep resources there, and the closures are a pragmatic call rather than a political one.
4. The Infinera Math
The anchor walked through the numbers on the turnaround: Nokia rejoined the EURO STOXX 50 in August as Volkswagen dropped out, the stock has posted triple-digit gains, and she said she had interviewed Nokia's previous two chief executives about their revival plans and that "none of it worked". What did work, on her account, was AI optics, and the Infinera acquisition that put credibility behind it as hyperscalers started building data centers.
Hotard put Nokia among two or three companies worldwide in that business, and two in the West. He called Infinera "probably the best acquisition you can make" and said the decision predated him, describing it as "a 1 + 1 = 10 type of example".
Neither optics business would have got there alone
I would say neither of these companies would have been as successful on their own. And together we now have a very unique position because we're at systems all the way down to semiconductor manufacturing for optics.
Justin Hotard
The Nokia optics unit he is talking about is the old Alcatel division, itself the product of an earlier acquisition. What the Infinera deal added was the bottom of the stack: Nokia now builds complete systems and the semiconductors that go in them.
The AI spending cycle has moved faster and bigger than Nokia planned for
What we've been fortunate about is we're in this AI super cycle and we're capturing the growth that's happening.
Justin Hotard
The investment cycle, he said, has accelerated over the last year "to a far faster pace and higher scale than we expected". His stated use for that is not the growth itself.
The point of the partnerships and the portfolio cuts is durability
But underneath that, we're also building a durable company.
Justin Hotard
Bonus Insights
The index change the anchor used as the scoreboard
Nokia returned to the EURO STOXX 50 in August, taking the place Volkswagen lost. That was the show's framing of the turnaround rather than Hotard's, and he did not comment on it.
Two previous turnaround plans, on the show's own account
The anchor said she had interviewed Nokia's last two chief executives about the strategies meant to revive the company, and that "none of it worked". Her reading is that what changed was not a plan but an asset: the optics business, arriving at the moment hyperscalers started spending on data centers.
The West-versus-China framing is now standard among American chief executives
Hotard cited Alex Karp's appearance on the same programme the day before as evidence he is not alone in it, and said politicians say the same thing more quietly, in the US and elsewhere in the West.
The week's other announcements
Beyond the Google partnership and the investment in Finland, Hotard referred to a radio network announcement Nokia made the day before the interview. He did not name the counterparty on air.
Hotard's bottom line is that closing Nokia's China sites follows a decision Chinese buyers made years ago rather than a change of strategy, and that what decides the company's next few years is the optical networking business it bought with Infinera, sold into an AI build-out he says is running faster and larger than Nokia planned for.
Products, Companies & Tools Mentioned
Nokia (His company: winding down almost all of its mainland China sites, keeping the technology licensing business there, and building its growth around trusted connectivity and optical networking)
Infinera (The optical networking company Nokia acquired. He calls it "probably the best acquisition you can make", says he cannot take credit for it, and says the combined business runs from complete systems down to semiconductor manufacturing)
Google (The partnership Nokia announced the week before, alongside Google's investment in Finland — his example of the partner-in-technology strategy)
Nvidia (The anchor's counter-example: a company that has kept trying to tap the Chinese market while Nokia withdraws from it)
EURO STOXX 50 and Volkswagen (Nokia rejoined the index in August as Volkswagen dropped out, which the anchor used as her marker of the turnaround)
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