Marvell Technology, a provider of data infrastructure semiconductor solutions, has reached an agreement to acquire Celestial AI, a developer of AI computing platforms, for an upfront sum of about $3.25bn.
The deal consists of $1bn in cash and around 27.2 million shares of Marvell common stock valued at $2.25bn.
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Marvell may pay up to a further $2.25bn in shares to Celestial AI’s equity holders if certain revenue targets are achieved by the end of the former’s fiscal year 2029.
This acquisition is intended to support Marvell’s strategy in developing connectivity solutions for AI and cloud data centres.
Celestial AI brings its Photonic Fabric technology, which is designed to enable large-scale optical interconnects for accelerated computing systems.
The company’s chiplet platform achieves 16 terabits per second bandwidth in a single unit. It is described by Marvell as having power efficiency advantages and stability that allow for integration with high-performance processing devices.
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By GlobalDataCelestial AI co-founder and CEO David Lazovsky said: “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.”
According to Marvell, the increased use of optical connections will be necessary as data centre networks move from electrical to optical solutions within racks, systems, and packages to meet changing bandwidth and power requirements.
Celestial AI is said to be actively collaborating with various hyperscalers and ecosystem partners who intend to incorporate its Photonic Fabric technology into their next-generation scale-up architectures.
Marvell chairman and CEO Matt Murphy said: “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.”
The transaction remains subject to regulatory review and other customary closing conditions, with completion anticipated in the first quarter of calendar year 2026.
