Marvell Technology has agreed to buy optical components maker Lumentum in a $115 billion all-stock deal, including debt, in one of the biggest transactions of 2026 and among the boldest corporate bets yet on the artificial intelligence boom.
Under the terms announced on Monday, Marvell will pay $1,132 per Lumentum share in stock, a 23.9% premium to Lumentum’s last unaffected closing price on 28 October, before reports of the talks first emerged. The deal carries an equity value of $102.54 billion, and Marvell said the combined company would address a $550 billion market.
Lumentum makes the optical components that move data at high speed between chips inside data centres — in effect, the plumbing of the AI era. As AI agents and chatbots drive demand for faster links connecting thousands of processors, Marvell is betting that demand for those components will keep outstripping supply for years.
The deal caps a remarkable rise for Marvell. Relatively little known three years ago, the company is now valued at more than $170 billion, helped by its work developing custom AI chips and networking technology for technology giants including Amazon. In August it signed a deal to supply chips that sit alongside Google’s AI processors, worth up to $120 billion in sales through fiscal 2033, with Google gaining the right to buy a $12.2 billion stake. Nvidia invested $2 billion in each of Marvell and Lumentum earlier this year, and in June Nvidia chief executive Jensen Huang called Marvell the next “trillion-dollar company”. Marvell’s annual revenue has more than doubled, from $3 billion in fiscal 2021 to $8.2 billion in fiscal 2026.
The acquisition also sharpens Marvell’s challenge to Broadcom, its larger rival, which has long been Google’s main custom-chip partner and offers customers a broader menu of AI data-centre hardware under one roof. Lumentum, which competes with US-listed Coherent and China’s Zhongji Innolight, could additionally benefit from a proposed US ban on new Chinese optical transceivers that would shift demand towards domestic suppliers.
Marvell shares rose 2.8% in premarket trading on Monday, while trading in Lumentum shares was halted. The announcement comes after a bruising few weeks for chip stocks: since the talks were first reported late last month, Lumentum shares have fallen about 8% and Marvell about 22%, as a broad sell-off accelerated following Intel’s weak forecast. Marvell has already been building its photonics business this year, closing a $3.5 billion purchase of Celestial AI in February. The Lumentum deal is its largest acquisition since its $10 billion buyout of Inphi in 2021.
Note: the featured image is a file photo of fibre-optic cables being installed, not a photograph of either company’s facilities.
Sources: Reuters, “Marvell to buy Lumentum in $115 billion deal in AI data-center bet”, 2 November 2026, https://www.reuters.com/legal/transactional/marvell-buy-lumentum-115-billion-deal-ai-data-center-bet-2026-11-02/
