Nvidia, AMD, and Intel Invest in Ayar Labs' Revolutionary Optical Interconnect Technology for AI

Nvidia, AMD, and Intel invest in Ayar Labs to enable futuristic light-based chips

Why it matters: Ayar Labs, a pioneer in optical interconnect technology that leverages light to transfer data between chips, has secured $155 million in Series D funding. The round was backed by semiconductor heavyweights Nvidia, AMD, and Intel, pushing the startup's valuation beyond $1 billion as it prepares for large-scale production. Ayar Labs is making waves by shrinking fiber optic data transmission technology to the chip scale. Its flagship product, the TeraPHY optical I/O chiplet, delivers a staggering four terabits per second of bi-directional bandwidth with ultra-low latency. Even more impressive, it achieves this while consuming just 10 watts or five picojoules per byte - a breakthrough in energy efficiency at such speeds. The chiplet integrates directly into advanced chip packages, replacing traditional electrical interconnects with cutting-edge optical solutions. This innovation could be a game-changer for modern AI workloads, which demand enormous data throughput. Power-hungry GPUs driving these workloads require advanced interconnects to eliminate system bottlenecks and reduce energy consumption, making Ayar Labs' technology critical for the next generation of computing. Ayar Labs' other key innovation is the SuperNova Light Source, which supplies 16 wavelengths of light to power 16 ports and 256 data channels - delivering a total 16 terabits per second of bi-directional throughput. Designed to complement the TeraPHY chiplets in server systems, this solution offers 5 - 10x higher bandwidth, 10x lower latency, and up to 8x greater power efficiency compared to traditional electrical interconnects. "The AI workload is really breaking the back of the existing hardware, especially for interconnects," said Ayar Labs CEO Mark Wade. "We've come up with a way to replace those electrical interconnects." "The leading GPU providers - AMD and NVIDIA - and semiconductor foundries - GlobalFoundries, Intel Foundry, and TSMC - combined with the backing of Advent, Light Street, and our other investors underscores the potential of our optical I/O technology to redefine the future of AI infrastructure," he added. While fiber optics have long been used for long-distance data transmission, miniaturizing the technology to the chip scale is a major technical feat. Ayar Labs has collaborated with manufacturers like GlobalFoundries and Intel to integrate its technology into high-volume chip production, with discussions reportedly underway with TSMC, according to Bloomberg. Wade revealed that customers are already sampling the TeraPHY chiplets, with high-volume qualification anticipated by mid-2026. The company plans to use the fresh $155 million in Series D funding to scale up manufacturing and meet the skyrocketing demand for AI interconnect bandwidth. The funding round was led by Advent Global Opportunities and Light Street Capital, with significant contributions from Nvidia, AMD Ventures, and Intel Capital - marking a collective endorsement from the "big three" chipmakers. Existing backers, including Lockheed Martin Ventures, GlobalFoundries, Applied Ventures LLC, and VentureTech Alliance, also participated in the round.

Nvidia, AMD, and Intel all invest in light-based communication networks powering next-gen chips -- Ayar Labs gets $155 million in funding

Ayar Labs, a developer of optical interconnection technologies for chip-to-chip and machine-to-machine connectivity, has received $155 million in Series D funding from venture capitalists, AMD Ventures, Intel Capital, and Nvidia. The participation of industry giants highlights the importance of optical interconnects for next-generation AI and HPC machines. Ayar Labs plans to start commercializing its technology by mid-2026. Ayar Labs has managed to shrink fiber-optic communication technology to fit within chip packages, which makes it critically important for companies like AMD, Intel, and Nvidia, which strive to replace electrical interconnects with optical ones, reports Bloomberg. The company has two products in development: the TeraPHY Optical I/O chiplet and the SuperNova multi-port, multi-wavelength light source. The TeraPHY Optical I/O chiplet is so tiny that it integrates seamlessly into advanced chip packaging and enables up to 4 Tbps of bidirectional bandwidth with a 5 ns latency per chiplet plus time-of-light (TOF) latency that is designed for package-to-package connections. The chiplet consumes about 10W, or 5 pJ per byte, which is a relatively low power consumption, given how fast TeraPHY is. The SuperNova remote light source is another key component of Ayar Labs' optical I/O solution. The device delivers up to 16 wavelengths of light to support 16 ports and can supply light for 256 data channels or 16 Tbps bidirectional. According to Ayar Labs, the device is designed to work seamlessly with TeraPHY and to provide 5-10 times higher bandwidth, 10 times lower latency, and 4-8 times greater power efficiency compared to traditional interconnects like pluggable optics and electrical SerDes. "The leading GPU providers -- AMD and Nvidia -- and semiconductor foundries -- GlobalFoundries, Intel Foundry, and TSMC -- combined with the backing of Advent, Light Street, and our other investors underscore the potential of our optical I/O technology to redefine the future of AI infrastructure," said Mark Wade, CEO and co-founder of Ayar Labs. "We are incredibly fortunate to have the backing of Light Street's deep expertise in technology-specific investments, as well as Advent's robust private and growth equity background in this funding round." GlobalFoundries currently manufactures Ayar's chips, but the company is also working with Intel to integrate its photonic technology into Intel's manufacturing processes and is in discussions with TSMC. Customers are already testing Ayar's chips, and TeraPHY and SuperNova are expected to be ready for high-volume production by mid-2026. Advent Global Opportunities and Light Street Capital led the Series D funding, which was participated in by AMD Ventures, Intel Capital, and Nvidia. New investors in Ayar include 3M Ventures and Autopilot. Existing backers of Ayar Labs, such as GlobalFoundries, Applied Ventures LLC, Lockheed Martin Ventures, and VentureTech Alliance, also contributed to Series D, bringing the company's total funding to $370 million and raising its valuation to over $1 billion.

Optical chip interconnect startup Ayar raises $155M to bring light to AI workloads - SiliconANGLE

Optical chip interconnect startup Ayar raises $155M to bring light to AI workloads Ayar Labs Inc., a startup that's developing optical interconnects that can transmit data between computer chips via light, said today it has closed on a hefty $155 million funding round led by Advent Global Opportunities and the aptly-named Light Street Capital. Also participating in the round was a veritable who's who of the industry's leading chipmakers, such as Nvidia Corp., Advanced Micro Devices Inc., Intel Corp. and GlobalFoundries Inc., who chipped in through their respective investment arms. VentureTechAlliance, which has a strategic partnership with Taiwan Semiconductor Manufacturing Co., also took part in the round. The investment brings Ayar Lab's total funding to $370 million, lifting its valuation beyond the $1 billion mark, at a time when the semiconductor industry is striving to deliver more efficient chip-to-chip communications to support artificial intelligence workloads. Ayar Labs is looking to do that by fixing one of the main bottlenecks in AI - namely, the movement of data between the powerful accelerator chips that are used to process AI training and inference. Most data center operations today rely on traditional electrical interconnects, but the industry has struggled to squeeze more bandwidth out of these. Ayar Labs, with its optical interconnects, says its light-based interconnects can transmit much more data, and do it much faster. Ayar Labs reckons its optical interconnect module, called TeraPHY, can help customers to maximize the compute efficiency and performance of AI infrastructure, while also lowering costs as it uses less power than traditional interconnects. In this way, it will not only improve performance, but also the "profitability metrics of AI applications." Ayar Labs says TeraPHY is the industry's first in-package I/O chiplet that can be integrated with system-on-chip packages to enable faster chip-to-chip communications, utilizing its SuperNova remote light technology. With the cash infusion from today's round, it says it's ready to start scaling the TeraPHY chip technology. Jordan Katz, a partner at Advent Global Opportunities, said he believes optical interconnect technology will revolutionize the future of AI infrastructure, and he thinks Ayar Labs is the best placed startup to lead that revolution. "We believe that supporting Ayar Labs and its groundbreaking technology will offer transformative benefits to AI systems," he enthused. The backing of so many major players in the semiconductor industry seems to suggest that Ayar Labs is on the verge of achieving something big, but it's by no means guaranteed that Nvidia, AMD and Intel will adopt the TerayPHY technology anytime soon. By investing in the startup, they can also get a much closer look at what it's doing, potentially aiding their own research into optical interconnects. Of course, the money should also put them at the front of the queue if they do decide to use Ayar Labs's tech. Ayar Labs does face quite a bit of competition in this area, though. One of its biggest rivals is a startup called Lightmatter Inc., which has attracted significantly more money from investors, having closed on a $400 million round in October that brought its total amount raised to $850 million. Lightmatter also has a much higher valuation, at over $4.4 billion. Other competitors include the Swiss startup Lightium AG, which closed on a $7 million seed funding round in September to try and make its Thin-Film Lithium Niobate optical interconnects, which based on a different technology, a reality. And in October, another rival called Xscape Photonics said it had raised $44 million, bringing its total funding to $57 million. It may well be that all of the above startups can make their mark in the coming years, as AI infrastructure spending is forecast to hit more than $1 trillion in the next decade, according to a recent report from Goldman Sachs. That report also highlights a "critical need" for technologies that can eliminate bottlenecks in AI workflows.

Ayar Labs secures $155M in funding from top US chipmakers NVIDIA, AMD, Intel - report By Investing.com

Ayar Labs Inc., a company that innovates in optical data transfer technology, has recently attracted substantial investment from leading US semiconductor companies, signaling a strategic move towards more efficient artificial intelligence (AI) processing, Bloomberg News reported. The San Jose-based startup announced a $155 million funding boost from Nvidia Corp . (NASDAQ:NVDA), AMD (NASDAQ:AMD) Ventures, and Intel (NASDAQ:INTC) Capital. This financial round was spearheaded by Advent Global Opportunities and Light Street Capital, propelling Ayar Labs' market value to surpass the $1 billion mark. The company's technology is positioned as a solution to the growing demands of AI workloads, which are known for their intensive energy consumption and high costs. Ayar Labs aims to address the limitations of current hardware by using light, or photons, to expedite data transfers. This method could potentially alleviate the common issues faced in server systems, such as data bottlenecks, excessive power usage, and heat generation during operations. Mark Wade, co-founder and CEO of Ayar Labs, emphasized the strain AI applications place on existing hardware, particularly in the area of interconnects, which link different parts of a computer system. "The AI workload is really breaking the back of the existing hardware infrastructure, especially in interconnects," Wade explained. By introducing photonics to replace traditional electrical interconnects, Ayar Labs is at the forefront of enhancing data transmission speeds and efficiency in AI processing. The investment from Nvidia, AMD, and Intel reflects a significant endorsement of Ayar Labs' approach, as these companies are at the pinnacle of semiconductor design in the United States. Their collective backing underscores the industry's commitment to overcoming the technical challenges of AI and supporting innovations that promise to revolutionize data transfer methods.

Nvidia, Intel And AMD Back Startup That Could Shake Up AI System Design

Ayar Labs says its optical interconnect technology can allow customers to 'maximize the compute efficiency and performance of their AI infrastructure, while reducing costs and power consumption, to dramatically improve profitability metrics for AI applications.' Nvidia, Intel and AMD have invested in a semiconductor startup that vows to improve the performance, efficiency and economics of large-scale AI systems with the power of light. The San Jose, Calif.-based startup, Ayar Labs, announced on Wednesday that it has raised a $155 million funding round at valuation of more than $1 billion from Nvidia as well as the venture arms of AMD and Intel along with several other investors, including U.S. contract chip manufacturer GlobalFoundries and VentureTech Alliance, which said it has a "strong strategic partnership" with Taiwanese foundry giant TSMC. [Related: The 10 Hottest Semiconductor Startups Of 2024] The startup seeks to address what it views as a pressing problem and a substantial opportunity in the AI infrastructure space: bottlenecks in data movement between chips and systems that can hold back AI training and inference workloads from running faster. One major culprit for this issue is traditional electrical interconnects, which Ayar hopes to replace with its optical interconnect technology. The startup said this technology provides major advantages over electrical interconnects by allowing customers to "maximize the compute efficiency and performance of their AI infrastructure, while reducing costs and power consumption, to dramatically improve profitability metrics for AI applications." Ayar's technology includes what it calls the "industry's first in-package optical I/O chiplet," which can be incorporated into system-on-chip packages for faster chip-to-chip communication and is powered by the startup's SuperNova remote light source. The startup said it plans to scale its optical interconnect technology with the new infusion of capital, which brought its total funding to $370 million. Jordan Katz, a partner at venture capital firm Advent Global Opportunities who recently joined Ayar's board in conjunction with the funding round, said the startup has "exciting engagements with Tier 1 customers" while adding that his firm believes "its groundbreaking technology will offer transformative benefits to AI systems." "We believe optical I/O is on the cusp of revolutionizing the future of AI infrastructure, and we recognize the significant growth potential of in-package optical interconnects," he said in a statement.

Ayar Labs, Latest Optical Interconnect Startup To Raise Big, Hits Unicorn Status

Ayar Labs locked up a $155 million Series D led by Advent International and Light Street Capital at a valuation of more than $1 billion, and became just the latest optical interconnect to land big money. The new round included participation from a number of strategics, including AMD Ventures, Intel Capital, Nvidia, 3M New Ventures and Autopilot. Existing investors such as Applied Ventures LLC, Axial Partners, Boardman Bay Capital Management, GlobalFoundries, IAG Capital Partners, Lockheed Martin Ventures, Playground Global and VentureTech Alliance also took part. Ayar's optical solutions to transmit data replace older electrical solutions to help users maximize compute efficiency and performance for artificial intelligence infrastructure while also reducing costs and power consumption. Founded in 2015, Ayar has raised $370 million, per the company. Ayar is just the latest optical interconnect startup trying to solve AI's bottlenecks concerning compute and power usage. In October, Lightmatter locked up a $400 million Series D led by new investor T. Rowe Price at a $4.4 billion valuation. The round nearly quadrupled its previous valuation of $1.2 billion in December after a $155 million raise led by GV -- which along with Fidelity also participated in the new round. That same week, Xscape Photonics -- a New York-based startup also using photonics technology to address the energy, performance and scalability challenges of AI data centers -- raised a $44 million Series A led by IAG Capital Partners and with investment from the likes of Cisco Investments and Nvidia.