(Bloomberg) -- Nokia Oyj won a $3.5 billion order from T-Mobile US Inc. to build fifth-generation mobile networks in the U.S., one of its largest contracts to date and a sign that network equipment vendors are starting to gain business from the new cellular technology.
Nokia will help build a nationwide 5G grid for the No. 3 wireless carrier, which has said its customers in New York, Los Angeles, Dallas and Las Vegas will be first to run the technology early next year.
The deal, which follows earlier announcements about the cooperation, is welcome news for the Finnish company. Chief Executive Officer Rajeev Suri has urged investors to look beyond weak results in the past couple of quarters, saying that the situation should brighten in the second half of the year as operators start spending on faster 5G gear.
“It’s our largest 5G deal to date, and in fact, one of the largest deals Nokia’s ever signed,” Phil Twist, vice president for marketing at Nokia’s Mobile Networks unit, said by phone. “This underlines and makes concrete that 5G is coming to the market.”
Nokia shares rose as much as 2.5 percent after the announcement and were trading 1.1 percent higher at 4.75 euros as of 4:37 p.m. in Helsinki. In a separate statement, Nokia said that its outlook included the impact of the T-Mobile agreement.
The U.S. and China have been early adopters of the next-generation mobile technology, and all major U.S. operators have announced plans to deploy 5G, which boasts download speeds and capacity that will enable everything from autonomous vehicles to remote surgery and traffic control. Nokia and its Swedish rival Ericsson AB are in prime positions to benefit from investments in the new infrastructure as their main competitor, China’s Huawei Technologies Co., is all but blocked from supplying equipment to U.S. carriers.
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