Marvell Technology has acquired Polariton Technologies, a Swiss firm specializing in plasmonics-based silicon photonics, to bolster its optical chip offerings for artificial intelligence data centers. The Santa Clara-based chipmaker did not disclose financial terms of the deal, which was announced early Friday.
Shares of Marvell fell 2.1% to $162.01 in early trading, pulling back from a recent rally driven by AI chip enthusiasm. The decline comes amid renewed focus on valuation and execution risks in the sector.
The acquisition is driven by the growing demand for faster and more energy-efficient optical links in AI data centers, which are increasingly required to move massive amounts of data between servers. Marvell noted that the industry is transitioning from 1.6T optical connectivity to 3.2T and higher, referring to ultra-fast data links that shuttle information inside and between data centers.
Polariton Technologies, founded in 2019 as a spin-out from ETH Zurich, has developed plasmonics-based silicon photonics technology that harnesses the interaction between light and electrons to transmit data using smaller and more power-efficient components than traditional electrical connections. Marvell plans to target this technology at coherent and data-center interconnect applications, specifically ZR and ZR+ modules that handle traffic across extended fiber links.
“Marvell continues to invest in advanced optical technologies,” said Sandeep Bharathi, president of Marvell's Data Center Group, in a company statement. He added that Polariton brings “differentiated modulation technology” and a specialized team, strengthening Marvell's optical roadmap.
The acquisition comes as competition intensifies among AI infrastructure suppliers. Earlier this week, Marvell shares jumped nearly 5% after reports that Alphabet's Google was negotiating with Marvell to co-develop two AI chips. Google already partners with Broadcom on its tensor processing units (TPUs). Broadcom remains a major competitor in custom chips, while Nvidia dominates the AI accelerator space. Marvell is positioning itself to capture more market share in custom silicon, switches, and optical links.
Nvidia recently invested $2 billion in Marvell, betting on tighter integration between Marvell's tailor-made AI chips and Nvidia's networking hardware and processors. This move opens up Marvell's semi-custom silicon and optical interconnects to Nvidia, addressing bandwidth and power efficiency limits.
Marvell reported fiscal 2026 revenue of $8.195 billion, a 42% jump year-over-year, with its data-center business generating $1.65 billion in the fourth quarter, accounting for 74% of total revenue. However, turning the technology and deal rationale into actual revenue remains unproven, and the company highlighted potential risks including retaining Polariton employees and executing on its acquisition strategy.
U.S. semiconductor stocks notched fresh records on Friday, buoyed by upbeat revenue guidance from Intel and ongoing optimism around AI-driven demand. “No sign that demand for AI is slowing down,” said Angelo Kourkafas of Edward Jones.
