Marvell Technology has agreed to buy silicon photonics startup Celestial AI in a deal valued at about $3.25 billion in upfront consideration, including $1 billion in cash and roughly 27.2 million Marvell shares valued at $2.25 billion.
The deal, announced alongside Marvell’s third-quarter fiscal 2026 results, is expected to close in the first quarter of calendar 2026, subject to regulatory approval.
Celestial AI brings a Photonic Fabric platform that uses optical links instead of copper to connect AI processors and memory across packages, systems and racks. Marvell said the technology will underpin next-generation scale-up fabrics and help it address a new optical interconnectivity market.
The move extends Marvell’s role in custom AI silicon and networking. CEO Matt Murphy told investors he now expects roughly $10 billion in total revenue next fiscal year, including a 25% increase in data center revenue and 20% growth in its custom chip business.