Which company announced in December 2025 its agreement to acquire Celestial AI for approximately $3.25 billion to boost optical interconnects for AI?

In December 2025, Marvell Technology announced its definitive agreement to acquire Celestial AI for approximately $3.25 billion. This strategic move was aimed at significantly enhancing Marvell's capabilities in optical interconnects, a critical technology for the rapidly evolving landscape of artificial intelligence. Celestial AI specializes in a disruptive "Photonic Fabric" platform designed for scale-up optical interconnects, which are essential for connecting the vast and complex systems powering modern AI and cloud data centers.

The acquisition addresses a growing challenge in AI infrastructure. As AI models and data centers continue to expand, the traditional copper-based interconnects are reaching their physical limits in terms of bandwidth, power consumption, and signal reach. Celestial AI's optical interconnect technology offers a solution to these bottlenecks, providing significantly higher bandwidth, lower latency, and greater power efficiency. This allows for the creation of multi-rack configurations that can tightly couple hundreds or even thousands of processing units (XPUs), enabling more powerful and efficient AI operations.

By integrating Celestial AI's Photonic Fabric technology, Marvell aims to solidify its position as a leading provider of comprehensive data infrastructure semiconductor solutions. The combination of Marvell's existing expertise and Celestial AI's innovative optical technology is expected to deliver an unparalleled portfolio of high-bandwidth, low-power, and low-latency solutions for the next generation of data center connectivity. This acquisition is seen as a transformative step for Marvell, expanding its leadership in AI connectivity and accelerating its roadmap to meet the demanding requirements of future AI and cloud architectures.