Nokia chief executive Justin Hotard said artificial intelligence is fuelling a structural growth cycle similar to the internet expansion of the 1990s, but rejected fears that investor enthusiasm has reached unsustainable levels.

“I fundamentally think we’re at the front end of an AI supercycle, much like the 1990s with the internet,” Hotard told Reuters. “Even if there’s a bubble, a trough, we’ll look to the longer-term trends. And right now, all those trends are very favourable.”

His comments follow a Bank of America survey showing that more than half of fund managers view AI-related stocks as being in bubble territory. High-profile figures including Amazon founder Jeff Bezos and OpenAI CEO Sam Altman have also warned of overvaluation risks.

Hotard, who led Intel’s data centre and AI division before joining Nokia in April, said demand for data infrastructure was driving the company’s performance. “Clearly the incremental, growth investment is driven by data centres,” he said. “It’s a huge step up in volume.”

Earlier on Thursday, the Finnish telecoms equipment maker reported quarterly earnings that exceeded market forecasts, supported by optical and cloud demand tied to AI-driven data centres. The results follow Nokia’s $2.3 billion (£1.9 billion) acquisition of U.S. optical networking firm Infinera [CHECK conversion].

Since selling its mobile phone business in 2013, Nokia has repositioned itself around network technology. It has recently deepened its AI strategy by integrating machine learning into radio access and fibre networks and establishing a dedicated Technology and AI organisation in September, led by Chief Technology Officer Pallavi Mahajan, a former Intel executive.

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