Today, Marvell Technology shares climbed 9% in premarket trading after the company revealed its $3.25 billion deal to acquire semiconductor startup Celestial AI.
Marvell will acquire Celestial AI with an upfront payment valued at approximately $3.25 billion, which includes $1.0 billion in cash and around 27.2 million shares of Marvell common stock.
Marvell anticipates significant revenue from Celestial AI starting in the second half of fiscal 2028, with an annualized rate of $500 million by the fourth quarter of fiscal 2028, doubling to a $1 billion run rate by the fourth quarter of fiscal 2029.
In its press release, Marvell also issued a warrant to Amazon.com, allowing the company to purchase Marvell shares related to its purchases of photonic fabric products through 2030.
Matt Murphy, Chairman and CEO of Marvell told investors, “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.”
David Lazovsky, Co-Founder and CEO of Celestial AI, commented, “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.”
Dave Brown, Vice President of Compute and Machine Learning Services at AWS stated, “Celestial AI has made impressive progress, and we expect their combination with a large-scale semiconductor company like Marvell will help further accelerate optical scale-up innovation for next-generation AI deployments.”
The transaction is expected to close in the first quarter of calendar 2026.
By CEO NA Editorial Staff
