Tower Semiconductor and Marvell Ship Over 5 Million Photonic Chips

Tower Semiconductor and Marvell Technology have shipped over 5 million coherent photonic integrated circuits (PICs) for AI data center applications. This milestone marks a significant step in the development of photonic chips for AI computing and is expected to fuel the growth of Tower Semiconductor. Marvell's growth prospects in AI networking and custom chips have been endorsed by industry leaders, but its valuation is deemed expensive compared to peers like Nvidia.

Tower Semiconductor (TSEM) and Marvell Technology (MRVL) announced on June 18, 2026 that they have jointly shipped over five million coherent photonic integrated circuits (PICs) to Marvell's global customers, marking a major production milestone for silicon photonics in AI data center applications . Coherent PICs are among the most technically demanding components in optical networking: unlike simpler direct-detect chips, they must precisely control both the phase and polarization of light, imposing far more stringent design and manufacturing requirements.

The partnership leverages Tower's specialized silicon photonics process platform to manufacture Marvell's coherent transceiver designs. Tower has developed advanced capabilities for this work, including integration of non-silicon materials into the fab process, 3D stacking of electronics with optical layers, and precision optical packaging techniques such as V-Grooves that improve fiber alignment and extend chip performance. These process innovations have made Tower a differentiated foundry partner for high-volume photonics production at a scale previously difficult to achieve.

The commercial momentum is substantial. According to a related May 2026 announcement, Tower secured $1.3 billion in contracted silicon photonics revenue for 2027, with 2028 capacity reservations described as substantially higher, suggesting the industry is accelerating its buildout of optical interconnect infrastructure . Marvell, for its part, has positioned coherent PICs as central to its AI networking strategy, with the company's custom chip and networking businesses cited by industry observers as primary growth drivers for the years ahead .

However, not all analysts share uniform enthusiasm. Marvell's stock was recently noted to trade at approximately 76x forward earnings compared to Nvidia's 24x, a premium that some argue is difficult to justify without near-flawless execution on its AI networking roadmap . For Tower, the photonics partnership represents a meaningful diversification away from its traditional analog and mixed-signal foundry business, though the company remains heavily dependent on continued capital expenditure growth from hyperscale data center operators.