Jibang Consulting: Marvell acquires Lumentum to achieve optical and electrical integration, which is expected to reshape the optical communication industry

The Zhitong Finance App learned that Jibang Consulting published an article stating that Marvell (Meiman Electronics) officially announced that it will acquire Lumentum, a major optical communications company. The boards of directors of the two companies passed the deal on November 2, but the case is still pending approval by shareholders of both parties and regulators in various countries. TrendForce Jibang Consulting said that if the merger and acquisition case is established, in addition to helping Marvell supplement the optical business map and work with Lumentum to propose better next-generation optical interconnection technology services, the current situation where the optical communication industry is dominated by Broadcom (Broadcom) will also change.

According to TrendForce Jibang Consulting estimates, Marvell and Lumentum will each rank fourth and eighth in the wired communication semiconductor market (semiconductor wired communication) revenue market in 2026. After the merger, the market share of the two companies in this application will rise to nearly 7%, second only to NVIDIA (NVIDIA) and Broadcom.

TrendForce Jibang Consulting analyzed that in the field of AI optical communication and interconnection, Broadcom has semiconductor chips such as Tomahawk Switch switching chips and DSP (digital signal processors), and components such as EML and CW Laser light sources, and is a leading manufacturer with both “light” and “electricity” capabilities. Marvell, on the other hand, focuses on “electricity,” and Lumentum focuses on “light.” After merging, the two will have both optoelectronic components and semiconductor IC capabilities, which is expected to break Broadcom's leading position.

TrendForce Jibang Consulting said that among the current key components of optical communication, Lumentum is one of the important laser light source suppliers, while Marvell supplies DSP and related optical communication application chips. If the merger passes, NVIDIA and other major cloud service providers (CSPs) will have an opportunity to reduce their dependence on Broadcom solutions and obtain more complete electro-optical interconnection solutions to maintain procurement flexibility.

From a technical perspective, the merger can also be viewed as Marvell's advance layout of scale-in and scale-up optical interconnects for the CPO/NPO generation. After Marvell makes up for its most lacking InP (indium phosphide) laser light source, it can form a “one electric, one light” light engine integration capability. After the merger, it is expected that Marvell's advanced CMOS chip design, high-speed switching chips, electro-optical interconnection, silicon photonics, and customized XPU capabilities will be combined with Lumentum's InP high-performance laser, optical transceiver module, and optical circuit switching (OCS) to provide an integrated solution covering chips, light engines, light sources and modules, and shorten customer development and introduction times through joint design and pre-verification.

However, the case has yet to be approved by the relevant regulators. TrendForce Jibang Consulting observes that as the world's main supplier of 800G/1.6T optical modules, downstream module manufacturers rely heavily on Marvell's DSP and EML/CW laser sources provided by manufacturers such as Lumentum. Since Lumentum also has an optical module manufacturer Cloud Light, if there is exclusivity in the supply strategy after the merger is approved (such as restricting competitors from obtaining key light sources or prioritizing the supply of subsidiary companies), it will directly affect the competitiveness of other optical module manufacturers. Therefore, it is estimated that whether the merger will affect the living space of other optical module manufacturers will be the focus of review by relevant regulators.