Samsung Electronics announced it has won a $6.64 billion order to provide wireless communication solutions to Verizon in the United States, a major win for the South Korean firm in the next-generation 5G network market.
Samsung’s global prospects for its network business have improved following U.S. sanctions on its bigger rival Huawei, analysts said.
Verizon is believed to be Nokia’s biggest customer, JP Morgan research said in a July note.
“Samsung winning the order from Verizon would help the company expand its telecom equipment business abroad, potentially giving leverage to negotiate with other countries,” said Park Sung-soon, an analyst at Cape Investment and Securities.
The order is for network equipment, a Samsung spokesman said.
“With this latest long-term strategic contract, we will continue to push the boundaries of 5G innovation to enhance mobile experiences for Verizon’s customers,” Samsung said in a statement.
Samsung said in a regulatory filing the period of the contract, which Samsung’s U.S. unit signed with Verizon Sourcing LLC, is from June 30, 2020 to Dec. 31, 2025.
The Trump administration last month unveiled plans to auction off spectrum previously dedicated to military purposes for commercial use starting in mid-2022, to ramp up fifth-generation network coverage in the United States.
The next-generation 5G wireless network is expected eventually to connect and enable high-speed video transmissions and self-driving cars, among other uses.