otherScore 100/100Research
Marvell acquiring Celestial AI's photonic fabric chiplets for scaleup interconnect; $500M→$1B revenue run rate by end of FY2029 targeting $6B+ TAM in optical scaleup switching/interconnects
Matt Murphy· Marvell Technology· AI· 2026-07-24· about Marvell Technology; Celestial AI (MRVL | private)
“After close, we expect meaningful revenue contributions from Celestial AI to begin in the second half of fiscal 2028. Our base case forecast shows Celestial AI's revenue reaching a $500 million annualized run rate in the fourth quarter of fiscal 2028, doubling to a $1 billion run rate by the fourth quarter of fiscal 2029... Industry analysts are forecasting the merchant portion of the scaleup switch market to approach $6 billion in revenue in 2030. On the interconnect side, we are seeing the dollar content for optics of the same magnitude as a scaleup switch... these are both very large and exciting incremental opportunities for Marvell.”
Why it matters
Marvell is making a material strategic bet on photonic interconnect as a critical bottleneck in multi-rack AI clusters. Celestial's thermal stability and co-packaging approach (photonics directly into XPUs vs. die-edge) addresses a key constraint in hyperscaler scaleup architectures, with design wins already secured from a tier-1 hyperscaler.
Investment implication
This signals accelerating adoption of optical interconnect in hyperscaler AI infrastructure beyond scaleout networks. Related beneficiaries: optical component suppliers (Broadcom, Coherent, Infineon), advanced packaging enablers (chiplet suppliers, substrate makers), and competing interconnect vendors. Also suggests capex pressure on hyperscalers to support multi-rack photonic fabric buildout.