Credo Technology Group Holding Ltd announced it has entered into a definitive agreement to acquire DustPhotonics, a developer of silicon photonics technology, in a deal valued at approximately $750 million in cash and stock, with additional contingent consideration tied to performance milestones.
The acquisition is designed to accelerate Credo’s expansion into silicon photonics and strengthen its position in next-generation optical connectivity solutions supporting AI-driven infrastructure and hyperscale data centers.
DustPhotonics specializes in Silicon Photonics Photonic Integrated Circuits (SiPho PICs), which integrate key optical functions onto a single chip, reducing complexity, improving manufacturing efficiency, and lowering costs as data speeds scale beyond 800G. The company’s technology supports applications across 400G, 800G, and 1.6T, with a roadmap extending to 3.2T, and is already deployed in leading hyperscale AI environments.
By bringing this capability in-house, Credo aims to vertically integrate its connectivity stack, combining silicon photonics with its existing expertise in SerDes and digital signal processing. The move is expected to reduce reliance on external suppliers, accelerate product development cycles, and improve cost structure at scale.
The transaction significantly expands Credo’s addressable market within the global optical industry, where silicon photonics is projected to grow rapidly as AI infrastructure demand increases. The combined platform is expected to enable end-to-end solutions spanning electrical and optical interconnects, from chip-level components to full system integration.
Credo expects the acquisition to contribute to strong growth in its optical business, with projections of more than $500 million in optical revenue by fiscal 2027 as adoption accelerates across hyperscale AI deployments. The transaction is expected to close in the second quarter of 2026, subject to regulatory approvals and customary closing conditions.
KEY QUOTES:
“Combining forces with DustPhotonics marks a defining step in Credo’s strategy to lead across the full spectrum of AI connectivity. We’ve built a strong position in high-speed electrical solutions, and this move decisively expands that leadership into Silicon Photonics with best-in-class PIC technology that complements our ZeroFlap Optical Transceivers and DSP portfolio.”
“This combination positions us at an inflection point in optical. As adoption accelerates across hyperscale AI infrastructure, we expect our optical business to scale into a meaningful and rapidly growing contributor by fiscal 2027.”
William Brennan, Chairman, President And Chief Executive Officer, Credo Technology
“Joining Credo is the natural next step for DustPhotonics. We built this company with a clear conviction that Silicon Photonics would become the structural foundation of high-speed optical connectivity as AI infrastructure scales.”
Ronnen Lovinger, Chief Executive Officer, DustPhotonics
“We believe DustPhotonics’ Silicon Photonic ICs and engines are a natural extension to Credo’s existing capabilities in optical connectivity, building on strong momentum across Credo’s DSP, ZF Optical Transceiver platform, and future Active LED Cable product lines.”
Gavin Baker, Managing Partner And Chief Investment Officer, Atreides Management
