Israeli chip startup DustPhotonics in advanced sale talks worth hundreds of millions
Potential buyers include Intel, Nvidia, and Amazon as photonics demand surges in AI infrastructure.
Israeli AI chip company DustPhotonics is in advanced negotiations to be acquired, Calcalist has learned. According to estimates, the deal is worth hundreds of millions of dollars and possibly more. Potential buyers include chip giants such as Intel and Nvidia, as well as technology companies like Amazon. DustPhotonics Chairman Avigdor Willenz previously sold Habana Labs to Intel and Annapurna Labs to AWS. Since its founding, the company has raised over $100 million from investors including Willenz and funds such as Greenfield Partners, Sienna Venture Capital, Exor Ventures, and Atreides Management.
DustPhotonics operates in the field of silicon photonics and develops technology that integrates optical components directly onto silicon chips, enabling ultra-high-speed data transfer with low energy consumption. Its Carmel series chips support data transfer rates of 400 Gbps, 800 Gbps, and even 1.6 Tbps.
The company was founded in 2017 by a group of experts in optical communications and chip design: Ben Rubovitch, a former CEO who previously worked at Mellanox; Dr. Kobi Hasharoni and Amir Geron, both from Compass Networks; and Yoel Chetrit, Chief R&D Officer, formerly of Intel. In 2021, the company made a significant strategic pivot, shifting from manufacturing edge components (such as transceivers and cables) to focusing on chip development. As part of this transition, Ronnen Lovinger was appointed CEO.
The sector in which DustPhotonics operates has been heating up recently, as photonics technology becomes a critical component in data centers. At Nvidia’s annual GTC conference earlier this year, CEO Jensen Huang identified photonics as a core pillar of AI infrastructure. While there had previously been uncertainty about whether alternative technologies might replace copper-based connectivity in data centers, Huang’s remarks signaled that photonics will play an integral role in Nvidia’s future strategy.
Against this backdrop, shares of companies active in the photonics space have surged. Israeli chipmaker Tower has risen 67% since the beginning of 2026, reaching a valuation of $24 billion. According to estimates, Tower is not a likely buyer of DustPhotonics. Other major players include U.S.-based Lumentum, whose shares have risen 130% this year to a valuation of $64 billion, and Coherent, which is trading at a similar valuation after a 60% increase. These gains have been further fueled by Nvidia’s announcement of a $4 billion strategic investment split between Lumentum and Coherent.
