Semtech Secures Dedicated SiGe Capacity at Tower
The expanded multi-year agreement extends a 20-year partnership to support optical interconnect demand for AI data centers.
Updated on Nov. 5, 2026 in Semiconductors
Semtech will invest in dedicated silicon germanium capacity at Tower Semiconductor under an expanded multi-year agreement that builds on a 20-year partnership. The secured capacity spans Tower's fabs in the United States, Israel and Japan.
Why it matters
AI clusters scaling across racks, rows and campuses increase the energy cost of moving data, making long-term capacity planning for optical interconnect components a priority. The agreement secures supply for Semtech's SiGe-based signal integrity portfolio.
Semtech's 224 Gbps per Lane TIA Family for Linear Pluggable Optics is built on Tower's SiGe process technology and was recognized with an ECOC 2026 Optical Component Innovation award. The agreement does not specify the production volumes or timelines for the secured capacity.
The players
Semtech
Semtech is a semiconductor company whose signal integrity portfolio serves optical and copper connectivity markets for data centers.
Tower Semiconductor
Tower Semiconductor is an Israeli specialty foundry known for its silicon germanium process technology and fabs in several countries.
Hong Hou
Hong Hou is the President and CEO of Semtech, leading the company's signal integrity and connectivity businesses.
Russell Ellwanger
Russell Ellwanger is the CEO of Tower Semiconductor, overseeing the foundry's specialty process technologies and manufacturing footprint.
The details
Semtech will invest in dedicated silicon germanium capacity at Tower, with the expanded agreement spanning fabs in the United States, Israel and Japan. The company's products serve fully retimed optics, linear pluggable optics, near-packaged optics, eXtra-dense pluggable optics and active copper cables.
Timeline
2026: Semtech receives the ECOC 2026 Optical Component Innovation award for its 224 Gbps per Lane TIA Family.
November 5, 2026: Tower and Semtech announce the expanded multi-year agreement.
The Tech Race
The deal secures SiGe supply for high-speed optical components as the industry moves from 800G toward 1.6T and 3.2T generations. It positions Semtech's SiGe-based products to compete for AI data center interconnect demand.
The secured SiGe capacity is aimed at supporting optical components inside AI data centers, which shapes the infrastructure behind cloud and AI services. Demand for these products is expected to grow across a broadening base of customer programs and end markets.
The takeaway
Long-term capacity agreements for specialty chip processes signal that optical interconnect supply is being planned years ahead as AI data center demand scales. Readers tracking data center infrastructure should watch how these supply commitments translate into product availability.
Further reading
For broader context on chip supply and fabrication, explore Semiconductors coverage on Wisevoter.
Source note: This article includes information reported by DQ.
