Marvell acquires Celestial AI for up to $5.5 billion to dominate optical AI infrastructure
13 Sources
[1]
Marvell to acquire Celestial AI for as much as $5.5 billion
The purchase price could increase to $5.5 billion if Celestial hits revenue milestones, Marvell said. The deal is an aggressive move for Marvell to acquire complimentary technology to its semiconductor networking business. The addition of Celestial could enable Marvell to sell more chips and parts
[2]
Marvell to Acquire Celestial AI for $3.5 Billion to Scale Up Data Centre Connectivity | AIM
Marvell Technology, a data infrastructure semiconductor solutions company, has announced plans to acquire Celestial AI, a startup focused on developing optical interconnect hardware, for $3.25 billion. This strategic acquisition is for accelerating the company's connectivity strategy for
[3]
Marvell bets big on optical interconnects, buying Celestial AI for up to $5.5B - SiliconANGLE
Marvell bets big on optical interconnects, buying Celestial AI for up to $5.5B Chipmaker Marvell Technology Inc. said today it has agreed to acquire a networking startup called Celestial AI Inc. that's developing optical interconnect technology to enable more rapid data center communications. The
[4]
This Semiconductor Stock Is Surging After an AI Deal and Strong Earnings
The semiconductor company also said it is acquiring Celestial AI in a $3.25 billion deal. Marvell Technology (MRVL) shares jumped Wednesday after the semiconductor company topped profit estimates on strong data center demand and announced an AI acquisition. The shares were up close to 5% in
[5]
Marvell in advanced talks to buy Celestial AI in multi-billion-dollar deal: The Information - The Economic Times
US chipmaker Marvell Technology is in advanced talks to acquire chip startup Celestial AI in a cash-and-stock deal worth multiple billions of dollars, the Information reported on Monday, citing people with knowledge of the deal. The total deal price, including earnouts from product milestones
[6]
Marvell Could Hit $10B Next Year, CEO Says -- And AI Demand Is Just Getting Started - Marvell Tech (NASDAQ:MRVL)
Marvell Technology Inc (NASDAQ:MRVL) just put a very loud stake in the ground: revenue could reach roughly $10 billion next year, CEO Matt Murphy said in the company's third quarter earnings call Q&A, and the market's reaction feels like it's still absorbing the size of that ambition. What sounded
[7]
Marvell may see 'material strength' for next 2 years, amid AI spending boom: analysts (MRVL:NASDAQ)
Marvell Technology (MRVL) may have reported in-line results and guidance, but it was the company's forecast for the next two years that had Wall Street analysts optimistic. Shares rose 9.5% in premarket trading on Wednesday, while Broadcom (AVGO Analysts are optimistic due to Marvell's positive
[8]
Why Are Shares Of Marvell Trading Higher Today? - Marvell Tech (NASDAQ:MRVL)
Shares of Marvell Technology, Inc. (NASDAQ:MRVL) are trading higher Wednesday after the company beat third quarter earnings estimates. What To Know: Marvell, which produces data infrastructure and semiconductors, reported quarterly earnings of $0.76 per share, which beat the analyst consensus
[9]
Why Is Marvell Technology Stock Gaining Tuesday? - Marvell Tech (NASDAQ:MRVL)
Marvell Technology, Inc. (NASDAQ:MRVL) is pushing deeper into the artificial intelligence hardware arms race, with a potential multi-billion-dollar deal to acquire a photonics startup that could boost its position in high-performance datacenter silicon, according to a report. The company is
[10]
Earnings call transcript: Marvell Technology Q3 2026 beats forecasts, stock rises By Investing.com
Marvell Technology reported its Q3 FY2026 earnings, showcasing a strong performance that exceeded market expectations. The company posted earnings per share (EPS) of $0.76, surpassing the forecasted $0.74, and achieved revenue of $2.08 billion, slightly above the anticipated $2.07 billion.
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Marvell shares jump as chipmaker bolsters AI ambitions with Celestial deal
Dec 3 (Reuters) - Marvell Technology shares climbed 9% premarket on Wednesday after its $3.25 billion deal to acquire semiconductor startup Celestial AI deepened investor confidence in the chipmaker's push into next-gen AI infrastructure. The company is doubling down on AI infrastructure to regain
[12]
Marvell to buy chip startup Celestial AI for $3.25 billion to boost networking portfolio
Dec 2 (Reuters) - Chipmaker Marvell Technology said on Tuesday it will buy semiconductor startup Celestial AI in a deal worth $3.25 billion and also forecast fourth-quarter revenue above Wall Street estimates. Marvell's shares were down 6% in extended trading. The generative AI boom has sped up
[13]
Marvell in Advanced Talks to Acquire Celestial AI in Over $5 Billion Deal
Marvell Technology Group Ltd specializes in designing and marketing integrated communications and storage circuits intended for manufacturers of high-speed network equipment, hard disks, and consumer electronics. Net sales break down by area of application as follows: - data centers (72.2%):
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Marvell Technology announced a $3.25 billion acquisition of Celestial AI, potentially reaching $5.5 billion with revenue milestones. The deal aims to strengthen Marvell's position in AI infrastructure by integrating Celestial's photonic fabric technology for optical interconnects. The semiconductor stock surged 9% following the announcement and strong Q3 earnings that beat expectations.
Marvell Makes Bold Move in Multi-Billion-Dollar Deal
Marvell Technology has announced plans to acquire Celestial AI in a multi-billion-dollar deal valued at $3.25 billion upfront, with the potential to reach $5.5 billion if specific revenue milestones are achieved
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. The acquisition represents an aggressive strategy for Marvell to secure complementary technology that could position the company more competitively in the booming AI infrastructure market. The deal is expected to close early next year, pending regulatory approval3
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Source: Benzinga
The maximum payout of $5.5 billion will be triggered if Celestial AI generates $2 billion in cumulative revenue by the end of fiscal 2029
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. Marvell will pay equity holders up to 27.2 million shares of common stock, valued at up to $2.25 billion, contingent on meeting these revenue milestones based on a 10-day volume-weighted average price2
. The semiconductor stock surged 9% in extended trading following the announcement and strong third-quarter earnings results1
.Photonic Fabric Technology Transforms Data Center Connectivity
Celestial AI specializes in developing optical interconnect hardware using what it calls photonic fabric technology, which enables high-performance computers to communicate at unprecedented speeds
1
. The startup was valued at $2.5 billion in March during a $250 million funding round, and Intel CEO Lip-Bu Tan joined its board in January1
. The technology addresses a critical bottleneck in AI computing chips as systems scale beyond single-rack configurations.
Source: ET
Optical connections are becoming essential because advanced AI systems require components that can tie together dozens or hundreds of chips to train and run large language models
1
. While many AI chip connections currently use copper wires, newer systems increasingly rely on optical connections because they transfer more data faster and enable physically longer cables1
. Celestial's technology boasts over twice the power efficiency of copper, with low power consumption and strong thermal stability2
.Next-Generation AI Deployments Drive Strategic Vision
The first application of Celestial technology will connect systems based on large XPUs, which are custom AI chips typically manufactured by companies investing billions in AI infrastructure
1
. Marvell CEO Matt Murphy stated the acquisition "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"1
.Marvell plans to integrate Celestial's optical technology directly into custom chips and related components called switches
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. The initial application targets scale-up interconnects delivering 16 terabits per second—ten times the capacity of current systems—while enhancing total bandwidth2
. Amazon Web Services Vice President Dave Brown endorsed the move, stating it will "help further accelerate optical scale-up innovation for next-generation AI deployments"1
.Related Stories
Marvell Seeks Competitive Edge Against Broadcom and Nvidia
The acquisition comes as Marvell attempts to close the gap with semiconductor rivals like Broadcom, which have seen significant valuation increases driven by AI excitement
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. Marvell stock is down 18% in 2025, while Broadcom's shares have surged more than 64%3
. The company competes against Broadcom for custom chip and networking businesses, while trying to establish relevance alongside Nvidia in the AI chip market5
.Marvell expects Celestial AI to start generating meaningful revenue in the second half of fiscal 2028, reaching a $500 million run rate by year-end and $1 billion by the end of fiscal 2029
2
. The company reported third-quarter adjusted earnings of $0.76 per share on $2.08 billion in sales, beating expectations, and projected data center revenue to rise 25% next year1
. Bullish analysts at Oppenheimer raised their target for Marvell to a new Street high of $150 from $115, citing optimism about the acquisition4
.Optical Interconnects Address AI Clusters Scaling Challenges
As multi-rack scale-up fabrics demand higher bandwidth, lower latency, and extended reach, interconnects will increasingly shift to all-optical connections
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. Sandeep Bharathi, president of Marvell's Data Centre Group, explained that "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"2
.
Source: AIM
The technology enables AI clusters to be distributed across large geographical areas, addressing the needs of cloud infrastructure providers spending hundreds of billions on AI infrastructure buildouts
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. Silicon photonics technology, which uses light rather than electrical signals, creates speedy links between AI computing chips and memory chips5
. This compact solution allows direct optical connections to XPUs while freeing up space for added high-bandwidth memory2
.References
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