Tower Semiconductor and Semtech Expand SiGe Partnership to Scale Power-Efficient Analog Connectivity for Data Centers
The capacity commitment extends a 20-year manufacturing partnership between Tower and Semtech.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Summary
Tower Semiconductor (TSEM) and Semtech (SMTC) expanded their multi-year partnership to secure dedicated manufacturing capacity for AI data center connectivity components.
Under the agreement, Semtech will invest in securing silicon germanium (SiGe) capacity, a semiconductor process used for its optical interconnect components. The secured capacity spans Tower’s factories in the United States, Israel and Japan, building on current production and providing Semtech additional supply assurance. The companies expect demand for Semtech’s SiGe-based products to grow across more customer programs and end markets.
Beyond capacity, Tower and Semtech continue working on a joint technology roadmap for multiple generations of AI data center interconnects. Their collaboration covers both optical and copper connectivity.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointExpanded multi-year agreement commits Semtech to invest in securing dedicated SiGe capacity at Tower.
- Minor pointDedicated capacity across three countries extends the manufacturing collaboration across Tower’s United States, Israel and Japan factories.
- Minor pointJoint technology roadmap continues development work for multiple generations of AI data center interconnects.
Negative
- None.
Key Figures
- Capacity regions
- 3 regions
- Dedicated SiGe capacity across the United States, Israel and Japan
- Partnership duration
- 20 years
- The expanded agreement builds on the companies' existing partnership
Previous Partnership Reports
-
Semtech recognized Tower's high-volume SiGe production for AI and data-center interconnect components.
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Key Terms
silicon germanium technical
transimpedance amplifiers technical
linear pluggable optics technical
active copper cables technical
AI-generated analysis. How Rhea-AI works. Not financial advice.
Multi-year agreement expands dedicated capacity across Tower's global fab network to support the companies’ growth in optical and copper interconnects for next-generation AI infrastructure
MIGDAL HAEMEK, Israel, and Camarillo, California, Oct. 13, 2026 -- Tower Semiconductor (Nasdaq/TASE: TSEM), the leading foundry for high-value analog semiconductor solutions, and Semtech Corporation (Nasdaq: SMTC), a leading provider of high-performance semiconductors powering AI data center networking and intelligent, connected Internet of Things ("IoT") devices worldwide, today announced an expanded multi-year agreement that builds on the companies’ 20-year partnership. Under the agreement, Semtech will invest in securing dedicated silicon germanium (SiGe) capacity at Tower in support of its strong design wins and demand for AI Data Center optical interconnect components.
AI’s next constraint is power, and a growing share of that power is spent moving data rather than computing it. As AI clusters scale across racks, rows and campuses, the energy cost of moving each bit is becoming central to how much useful work each accelerator can deliver. Each step in the speed roadmap, from 800G to 1.6T and on to 3.2T, raises the requirements for bandwidth, reach and power per bit, and increases the importance of the high-speed analog front end that drives and receives the signal.
Semtech’s signal integrity portfolio, including transimpedance amplifiers (TIAs), modulator and laser drivers and linear equalizers, is built on Tower’s SiGe process technology and serves fully retimed optics (FRO), linear pluggable optics (LPO), linear receive optics (LRO), near-packaged optics (NPO), eXtra-dense pluggable optics (XPO), linear equalizers on PCB and active copper cables (ACC). Semtech believes that, together, these products position it to address copper links within the rack and optical links across the data center as the industry moves to its next generation of architectures.
A testament to the results of the partnership is Semtech’s recent Optical Component Innovation (Chip/Wafer) award at the European Conference on Optical Communication (ECOC) 2026. The award recognizes Semtech’s 224 Gbps per Lane TIA Family for Linear Pluggable Optics built on Tower’s leading-edge SiGe technology. Tower and Semtech continue to work closely not only on capacity but also on joint technology roadmap designed to secure product leadership in multi-generational AI data center interconnects.
The secured capacity spans Tower’s fabs in the United States, Israel and Japan, adding supply resilience and geographic diversification to Semtech’s manufacturing strategy. Building on current production, the agreement gives Semtech additional supply assurance as demand for its SiGe-based products is expected to grow across a broadening base of customer programs and end markets.
“Connectivity is now a primary factor in how far AI systems can scale,” said Hong Hou, Semtech President and Chief Executive Officer. “Our customers are scaling interconnect bandwidth quickly and at massive scale. Meeting that demand requires long-term capacity planning and commitment with our manufacturing partners. Tower has been a trusted partner to Semtech for 20 years, and we are very pleased with our partnership agreement that secures dedicated SiGe capacity across three regions to grow across copper and optical interconnects, from 800G and 1.6T today through 3.2T and beyond.”
“It is a source of profound satisfaction that our partnership with Semtech has grown so strong,” said Russell Ellwanger, Chief Executive Officer, Tower Semiconductor. “Together, we are driving truly accretive, platform-level solutions that help advance their designs delivering best-in-class figures of merit across present-generation, next-generation and N+2 technologies. By qualifying these solutions well ahead of market need, we both stand fully prepared for immediate implementation as the market moves into these generations. In doing so, we are the key drivers of the technologies carrying the market forward, ensuring a continual expansion of our already leading market share in optical transceiver connectivity within this high-growth market."
For additional information about Tower’s SiGe and SiPho technology platforms, visit here.
About Tower Semiconductor
Tower Semiconductor Ltd. (NASDAQ/TASE: TSEM), the leading foundry of high-value analog semiconductor solutions, provides technology, development, and process platforms for its customers in growing markets such as consumer, industrial, automotive, mobile, infrastructure, medical and aerospace and defense. Tower Semiconductor focuses on creating a positive and sustainable impact on the world through long-term partnerships and its advanced and innovative analog technology offering, comprised of a broad range of customizable process platforms such as SiPho, SiGe, BiCMOS, mixed-signal/CMOS, RF CMOS, CMOS image sensor, non-imaging sensors, displays, and integrated power management (BCD and 700V). Tower Semiconductor also provides world-class design enablement for a quick and accurate design cycle as well as process transfer services including development, transfer, and optimization, to IDMs and fabless companies. To provide multi-fab sourcing and extended capacity for its customers, Tower Semiconductor currently owns one operating facility in Israel (200mm), two in the U.S. (200mm), and two in Japan (200mm and 300mm) which it owns through its
Tower Semiconductor’s Safe Harbor Regarding Forward-Looking Statements
This press release includes forward-looking statements, which are subject to risks and uncertainties. Actual results may vary from those projected or implied by such forward-looking statements. A complete discussion of risks and uncertainties that may affect the accuracy of forward-looking statements included in this press release or which may otherwise affect Tower’s business is included under the heading “Risk Factors” in Tower’s most recent filings on Forms 20-F, F-3, F-4 and 6-K, as were filed with the Securities and Exchange Commission (the “SEC”) and the Israel Securities Authority. Tower does not intend to update, and expressly disclaim any obligation to update, the information contained in this release.
About Semtech
Semtech Corporation (Nasdaq: SMTC) is a leading provider of high-performance semiconductors powering AI data center networking and intelligent, connected IoT devices worldwide. Our global teams are committed to empowering solution architects and application developers to develop breakthrough products for the infrastructure, industrial and consumer markets. To learn more about Semtech technology, visit us at Semtech.com or follow us on LinkedIn or X.
Semtech’s Forward-Looking and Cautionary Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events or to Semtech's future financial performance, including statements regarding the anticipated benefits of the expanded agreement with Tower, the expected expansion, timing and availability of dedicated SiGe manufacturing capacity, anticipated demand for Semtech's products and growth in AI data center interconnect markets, Semtech's design win pipeline, and the companies’ technology roadmaps, which reflect the current analysis of existing information. Statements containing words such as “believe,” “will,” “expect,” “anticipate,” “intend,” “see,” “designed,” or “positioned,” or other similar expressions constitute forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.
Forward-looking statements involve known and unknown risks, uncertainties, and other factors that could cause Semtech's actual results, performance, and achievements to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to: Tower's ability to install equipment and expand SiGe manufacturing capacity at its fabs on the anticipated timeline, or at all, including as a result of circumstances outside of Tower's control; the risk that demand for Semtech's SiGe-based products does not develop as anticipated or that Semtech does not fully utilize the capacity reserved for it under the agreement; the risk that Semtech's design wins do not result in production orders or revenue at the levels or on the timing anticipated; the pace of AI data center investment and the rate of adoption of next-generation interconnect speeds; Semtech's reliance on Tower for the manufacture of its SiGe-based products and the concentration of that manufacturing in a limited number of facilities, including in Israel; competitive pressures and pricing; supply chain constraints; the impact of adverse changes to general economic conditions, including economic slowdowns, inflation, interest rate changes, recessions, and the impact of tariffs or retaliatory tariffs; and the other factors and risks set forth in Semtech's filings with the U.S. Securities and Exchange Commission, including (i) the “Risk Factors” section of Semtech’s Annual Report on Form 10-K for the fiscal year ended January 25, 2026 and (ii) subsequent Quarterly Reports on Form 10-Q. The forward-looking statements and information contained herein speak only as of the date of this release. Semtech undertakes no obligation to update any forward-looking statements or information to reflect events or circumstances after the date of this press release, except as required by applicable law.
Semtech and the Semtech logo are registered trademarks or service marks of Semtech Corporation or its subsidiaries. All other trademarks, service marks and trade names mentioned in this press release are the property of their respective owners.
SMTC-P
###
Investor Contacts
Liat Avraham, Tower Semiconductor +972-4-6506154, liatavra@towersemi.com
Mitch Haws, Semtech Corporation, mhaws@semtech.com
Media Contacts
Tower Semiconductor Company Contact: Orit Shahar | +972-74-7377440 | oritsha@towersemi.com
Semtech Corporation Company Contact: Michelle Lozada | pr@semtech.com
Attachment
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What does Tower Semiconductor’s expanded agreement with Semtech cover?
The multi-year agreement provides for Semtech to invest in securing dedicated silicon germanium capacity at Tower for AI data center optical interconnect components. The secured capacity spans Tower’s factories in the United States, Israel and Japan and builds on current production.