Nokia Oyj and Finnish AI startup NestAI have entered into a €100 million partnership that will fund the development of next‑generation AI solutions for unmanned vehicles, autonomous operations and command‑and‑control platforms in the defense sector.
The collaboration blends Nokia’s secure, AI‑native connectivity, sensing and multimedia expertise with NestAI’s physical‑AI platforms. Together they aim to deliver faster, more informed decision‑making for European defense forces and other NATO and Five Eyes partners, reinforcing Europe’s technological independence amid growing geopolitical tensions.
The partnership aligns with Nokia’s broader AI strategy, which has seen the company invest heavily in AI‑native networks and cloud services. In Q3 2025, Nokia reported revenue growth driven by its Optical Networks and Network Infrastructure segments, while Mobile Networks and Cloud & Network Services also contributed to overall expansion. The new defense incubation unit will enable Nokia to co‑innovate with partners in the U.S., Finland and other allied countries, positioning the company to capture a larger share of the rapidly growing defense‑AI market.
NestAI, a rapidly expanding European physical‑AI lab that emerged from PostScriptum, focuses on robotics and unmanned vehicles. The €100 million investment will accelerate its development of AI for defense applications, helping the company become a significant player in Europe’s sovereign defense technology sector.
Justin Hotard, President and CEO of Nokia, said, “At Nokia, we believe that the future of defense and critical infrastructure will be defined by secure, AI‑native solutions. Our partnership with NestAI demonstrates our commitment to innovation with trusted partners.” Peter Sarlin, Chairman of NestAI, added, “This collaboration safeguards Europe’s sovereignty and strengthens our security and resilience.”
While specific market reaction data for this announcement is not available, the partnership is expected to enhance Nokia’s defense portfolio and support its strategy to expand beyond traditional telecom customers. The deal also signals a broader shift toward AI‑driven defense solutions, a trend that is likely to attract further investment and partnership activity across the industry.
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