Marvell has agreed to buy Lumentum for an enterprise value of $115 billion, paying entirely in stock, to cover both the chips and the lasers that move data inside AI data centers.
According to a joint press release dated November 2, Lumentum shareholders get 4.5 Marvell shares per share, which the companies value at about $1,132. That is a 23.9% premium over the October 28 close, the last trading day before reports of the deal moved prices. Marvell holders would own about 67% of the combined company and Lumentum holders about 33%. Both boards approved the deal unanimously. Closing is expected in the first half of 2028, pending regulatory and shareholder approval. Press reports describe it as the second-largest tech deal ever, behind the SpaceX-xAI merger.
The logic is physical. Copper links become impractical at around one to two meters, so AI clusters increasingly move data as light. Marvell already sells the electronics around that light: optical DSPs (signal-processing chips), silicon photonics, and high-speed interfaces. Lumentum makes the optical parts, including lasers, modulators, transceivers, and optical circuit switches. It also works in indium phosphide, a material that emits light efficiently where silicon does not, and runs its own factories for it. Its CEO, Michael Hurlston, called that the world's largest indium phosphide manufacturing footprint, which is the company's own claim.
This is the third optical purchase in five years, after Inphi for $10 billion in 2021 and Celestial AI for $3.5 billion upfront, completed in February 2026. Each bought a different layer of the same problem. This one is the biggest, and it breaks Marvell's mostly fabless habit by giving it factories.
The obvious comparison is Broadcom, Marvell's main optics rival, which already sells both electronic chips and optical components. Lumentum would give Marvell a similar spread.
The harder issue is customers. Marvell supplies optical module makers, while Lumentum sells components to companies that compete with its own transceiver business. Marvell CEO Matt Murphy said on a November 2 investor call that the company intends to keep its current component supply model, and Hurlston noted that supplying competitors is already normal in optics. With closing more than a year away, that pledge has a long time to be tested against customers' patience.