Ayar Labs Raises $500 Million to Mass-Produce Optical AI Interconnects — Backed by NVIDIA and AMD

As AI models balloon in size, the humble copper wire connecting chips inside data centers has become a bottleneck. Ayar Labs just secured the war chest to fix it.

A $500 Million Bet on Light

Ayar Labs closed a $500 million Series E at a $3.75 billion valuation, with backing from NVIDIA, AMD, MediaTek, and lead investor Neuberger Berman. The funds will scale production of TeraPHY optical chiplets — tiny silicon photonics devices that transmit data between processors using light instead of electricity.

20x More Bandwidth Per Watt

The performance gains are staggering. Optical interconnects deliver four to twenty times more throughput per watt compared to copper, which means AI clusters can scale further without drowning in heat and energy costs. For operators building the next generation of training supercomputers, this technology is a game-changer.

From Lab to Factory Floor

Ayar Labs indicated this may be its final private round before an IPO. A new office in Taiwan will support global manufacturing partnerships, signaling that optical chiplets are moving from niche research into volume production.

When NVIDIA and AMD both invest in the same startup, the signal is unmistakable — optical interconnects are the future plumbing of artificial intelligence.

Sources: Ayar Labs Press Release, March 3, 2026; The Register, March 3, 2026