Marvell Technology, a leader in data infrastructure semiconductor solutions, announced it has entered into a definitive agreement to acquire Celestial AI, a pioneer of a disruptive Photonic Fabric technology platform designed for scale-up optical interconnects. This acquisition represents a significant milestone in accelerating Marvell’s connectivity strategy for next-generation AI and cloud data centers.
The rapid evolution of AI is reshaping data center architectures, pushing them beyond traditional configurations. Next-generation accelerated systems are not limited to a single rack; they are evolving into multi-rack setups that connect hundreds of XPUs through an integrated high-bandwidth, ultra-low latency optical fabric. This architecture enables each XPU to directly access the memory of every other XPU, requiring purpose-built switches and protocols such as UALink to deliver the performance and efficiency required at scale.
As the demands for power, bandwidth, latency, and reach increase, interconnects will increasingly transition to all-optical connections. This strategic acquisition positions Marvell to spearhead this technological shift and capture a new semiconductor total addressable market (TAM) focused on optical interconnects. With its existing expertise in scale-out and scale-across connectivity, Marvell aims to provide the most comprehensive high-bandwidth, low-power, low-latency solutions for next-generation data center connectivity.
Celestial AI’s Photonic Fabric technology platform is designed for this critical transition. It enables large AI clusters to scale both within and across racks using a high-bandwidth, low-latency, and cost-effective optical fabric. This breakthrough solution boasts more than twice the power efficiency of traditional copper interconnects, along with significantly longer reach and higher bandwidth. Celestial AI’s approach features exceptionally low power consumption and nano-second class latency, which are essential for deep optical interconnectivity into XPUs and switch systems.
The thermal stability of Celestial AI’s Photonic Fabric technology emerges as a key competitive differentiator. It supports reliable operations in the extreme thermal environments generated by large, multi-kilowatt XPUs and switches, allowing the photonics technology to be co-packaged vertically with these components in a 3D package. This configuration facilitates direct optical connections to the XPU, optimizing the use of die edge space, which can be repurposed to increase the amount of high-bandwidth memory (HBM) within the XPU package.
The first application of this technology will involve all-optical scale-up interconnects, marking a shift from copper to optics for high-speed XPU links. Celestial AI’s first-generation Photonic Fabric chiplet for scale-up interconnect integrates all necessary electrical and optical components into a compact form factor. This chiplet delivers a groundbreaking 16 terabits per second of bandwidth in a single unit, achieving ten times the capacity of current state-of-the-art 1.6T ports used in scale-out applications. Its compact design allows multiple chiplets to be co-packaged with XPUs and scale-up switches, significantly enhancing overall system bandwidth.
Celestial AI is actively collaborating with multiple hyperscalers and ecosystem partners who plan to integrate this photonic technology into their next-generation architectures. Based on existing customer interest, Marvell anticipates that revenues from Celestial AI will begin to contribute meaningfully in the second half of fiscal 2028, with a projected annualized run rate of $500 million by the fourth quarter of fiscal 2028 and doubling to $1 billion by the fourth quarter of fiscal 2029.
Beyond serving as a connection method for XPUs in scale-up networks, Celestial AI’s Photonic Fabric technology holds the potential to enable a variety of transformative applications, including pooled memory appliances and optical replacements for traditional electrical connections in multi-die packages.
Matt Murphy, Chairman and CEO of Marvell, stated, “The acquisition of Celestial AI is a transformative step in Marvell’s evolution and expands our leadership in AI connectivity, as scale-up becomes the next frontier in AI infrastructure. This builds on our technology leadership, broadens our addressable market in scale-up connectivity, and accelerates our roadmap to deliver the industry’s most complete connectivity platform for AI and cloud customers.”
Sandeep Bharathi, President of the Data Center Group at Marvell, added, “AI infrastructure is transforming faster than ever, and the future demands scale-up fabrics that deliver unprecedented bandwidth, power efficiency, and reach. By combining our UALink scale-up switch roadmap and Celestial AI’s breakthrough optical scale-up interconnect, we will enable customers to build AI systems that scale beyond the limits of copper and redefine what’s possible in AI data center architecture.”
Dave Brown, Vice President of Compute and Machine Learning Services at AWS, commented, “At AWS, we aim to be at the forefront of major technology inflections, and we believe optical interconnects will play an important role in the future of AI infrastructure. Building a scalable, high-performance, and power-efficient cloud starts with an approach built upon differentiated technologies. Celestial AI has made impressive progress, and we expect their combination with a large-scale semiconductor company like Marvell to further accelerate optical scale-up innovation for next-generation AI deployments.”
David Lazovsky, Co-Founder and CEO of Celestial AI, remarked, “Marvell is the ideal home for our Photonic Fabric, with the scale, customer relationships, and connectivity leadership to take this platform into high-volume production. Together with Marvell’s scale-up switching strategy, we’re excited to accelerate the transition to optical scale-up interconnect and expand what next-generation AI infrastructure can achieve.”
See also
DeepSeek Launches V3.2 Model, Achieves Gold Medal-Level Math Performance
Micron’s Hiroshima Investment: A $3.7B Strategy to Secure AI Memory Supply Chain Resilience
OpenAI Disables ChatGPT Ads After Subscriber Backlash Over Intrusive Promotions
Investors Forecast Stagnant Growth Amid Rising Cyber Risks and AI Transparency Demands
