Nvidia commits $4B to 2 US photonics firms

ISTANBUL

US chip giant Nvidia announced Monday that it is putting a total of $4 billion into two US photonics players as it tries to strengthen both its research and development (R&D) pipeline and the supply chain needed for the next wave of AI data-center expansion.

The chipmaker said it will invest $2 billion in Lumentum and another $2 billion in Coherent. Both companies work on optics and photonics – hardware that generates, shapes, and transmits light, which is crucial for tasks like ultra-fast data movement inside and between servers, as well as sensing.

Lumentum focuses on optical and photonic technologies aimed at the networking backbone that supports AI, cloud infrastructure, and newer communications systems. Coherent, also US-based, develops photonics components and systems that use photons to enable high-performance optical applications.

Nvidia framed the deals as part of its push to bring more advanced “silicon photonics” into large-scale AI infrastructure – positioning this technology as a building block for the next generation of massive, power-hungry AI computing facilities.

“Together with Lumentum, NVIDIA is advancing the world’s most sophisticated silicon photonics to build the next generation of gigawatt-scale AI factories,” Jensen Huang, CEO of Nvidia, said in a statement.

Under its agreement with Lumentum, Nvidia has entered into a multi-year strategic partnership that features a multi-billion-dollar purchasing commitment, along with secured future production capacity for advanced laser components.

Huang also said Nvidia will collaborate with Coherent to design and develop next-generation silicon photonics tailored for AI infrastructure.

The arrangement with Coherent similarly includes a multi-billion-dollar purchase commitment, as well as guaranteed future access and capacity rights for cutting-edge laser and optical networking technologies.