The US semiconductor firm invests in dedicated manufacturing capacity to power next-generation optical interconnects.
Tower Semiconductor and Semtech Corp have expanded their 20-year manufacturing alliance to support growing demand for artificial intelligence data centre components. Under the updated agreement, Semtech will invest directly in securing dedicated silicon germanium (SiGe) production capacity across Tower’s foundry facilities.
The expansion comes as hyperscale AI clusters face mounting power constraints, with an increasing proportion of total energy consumed simply transferring data between chips. As network architectures scale from 800G to 1.6T and 3.2T speeds, high-performance analog front-ends become vital for managing bandwidth, reach, and power-per-bit efficiency.
Semtech’s signal integrity products—including transimpedance amplifiers (TIAs) used in fully retimed optics (FRO), linear pluggable optics (LPO), and active copper cables (ACC)—rely heavily on Tower’s SiGe process technology. Securing manufacturing volume across Tower’s fabs in the United States, Israel, and Japan provides Semtech with supply chain resilience and geographic diversification as customer adoption accelerates.
“Meeting this demand requires long-term capacity planning and commitment with manufacturing partners,” noted Hong Hou, President and CEO of Semtech. Tower CEO Russell Ellwanger added that both companies are co-developing a joint technology roadmap to deliver multi-generational interconnect platforms for future AI data centre infrastructure.
