Marvell to Acquire Celestial AI for $3.25 Billion to Advance Optical Connectivity for AI Data Centers

Marvell Technology, Inc. said it will acquire Celestial AI for approximately $3.25 billion in cash and stock, announced in a press release. The acquisition strengthens Marvell’s position in optical interconnects for AI and cloud data centers and is expected to close in the first quarter of 2026, pending regulatory approval.

Celestial AI’s Photonic Fabric platform enables optical input/output connectivity across packages, systems, and racks, supporting high-bandwidth and low-latency communication within AI infrastructure. The technology is designed to replace copper interconnects, improving power efficiency and scalability for multi-rack AI systems.

Marvell plans to integrate Celestial AI’s optical scale-up interconnects with its existing UALink switch roadmap. The company expects meaningful revenue contributions from the acquisition beginning in the second half of fiscal 2028, reaching a $500 million annualized rate by the fourth quarter of that year and doubling to $1 billion by fiscal 2029.

The transaction includes $1 billion in cash and about 27.2 million shares of Marvell common stock valued at $2.25 billion. An additional earnout of up to 27.2 million shares may be issued if Celestial AI meets certain revenue milestones by fiscal 2029.