Tower Semiconductor and Semtech expand SiGe capacity deal for data centers

Tower Semiconductor (Nasdaq: TSEM) and Semtech Corporation (Nasdaq: SMTC) announced an expanded multi-year agreement on Oct. 13, 2026, under which Semtech will secure dedicated silicon germanium (SiGe) manufacturing capacity across Tower's fabrication facilities in the United States, Israel and Japan.

The agreement builds on a 20-year partnership between the two companies and is aimed at supporting Semtech's optical and copper interconnect products used in data center infrastructure. Semtech's signal integrity portfolio — including transimpedance amplifiers, modulator and laser drivers, and linear equalizers — is manufactured using Tower's SiGe process technology.

The companies said the capacity expansion covers interconnect speeds from 800G and 1.6T currently through 3.2T and beyond. The secured capacity across three geographic regions is intended to add supply resilience to Semtech's manufacturing base as demand for its SiGe-based products is expected to grow.

Semtech received an Optical Component Innovation award at the European Conference on Optical Communication (ECOC) 2026 for its 224 Gbps per lane transimpedance amplifier family for linear pluggable optics, which is built on Tower's SiGe technology.

"Connectivity is now a primary factor in how far AI systems can scale," said Hong Hou, Semtech President and Chief Executive Officer. "Meeting that demand requires long-term capacity planning and commitment with our manufacturing partners."

"Together, we are driving truly accretive, platform-level solutions that help advance their designs delivering best-in-class figures of merit across present-generation, next-generation and N+2 technologies," said Russell Ellwanger, Chief Executive Officer of Tower Semiconductor.

The two companies said they are also collaborating on a joint technology roadmap for multi-generational data center interconnect products. Financial terms of the agreement were not disclosed.

You May Also Be Interested In

• Bank of America adds two former CEOs to its board
• Dell Technologies names new general counsel as longtime executive retires
• Tesla stock up as automotive gross margin improves, free cash flow turns positive