HELSINKI, Sept 3 (Reuters) - U.S. telecoms operator AT&T ( T )

and Finnish network equipment maker Nokia have

signed an agreement to build a fibre network in the U.S., the

Finnish company said on Tuesday.

The deal comes after Nokia lost a major deal with AT&T ( T ) to

its Swedish rival Ericsson, which the U.S. operator

chose in December to build a telecoms network that will cover

70% of its wireless traffic in the United States by late 2026.

Nokia is eyeing new growth in fibre after AT&T's ( T ) $14 billion

five-year deal with Ericsson.

Nokia did not disclose the financial value of the new

five-year fibre deal but called it "a significant milestone" and

said it would "boost broadband access for millions of users" in

the U.S., while supporting AT&T's ( T ) extensive fibre network

footprint "that passed 27.8 million total fibre locations as of

the second quarter of 2024".

In July, Nokia reported a 32% drop in profit but CEO Pekka

Lundmark forecast that net sales would significantly accelerate

in the second half of the year, pointing to an improving fibre

market in the U.S. and a $42 billion U.S. government programme

to boost citizens' access to high-speed broadband.

Nokia said the fibre deal with AT&T ( T ) is "Build America, Buy

America-compliant", to meet the requirements of U.S. government

funding.

In June, Nokia announced the acquisition of U.S. optical

networking gear maker Infinera ( INFN ), in a $2.3 billion deal

in a bid to gain from the billions of dollars in investment

pouring into data centres to cater to the rise of artificial

intelligence.