Tower Semiconductor Teams with NVIDIA to Advance AI Infrastructure with 1.6T Data Center Optical Modules
Rhea-AI Summary
Tower Semiconductor (NASDAQ: TSEM) announced a collaboration with NVIDIA on 1.6T data center optical modules using Tower's silicon photonics platform on February 5, 2026. The company says its SiPho technology can enable up to 2x data-rate versus prior silicon photonics solutions, targeting higher bandwidth and throughput for AI infrastructure.
This work is positioned to support NVIDIA networking protocols and scale high-speed optical interconnects for data center and AI deployments.
Positive
- Announced support for 1.6T data center optical modules aligned with NVIDIA networking protocols
- SiPho platform claims up to 2x data-rate versus prior silicon photonics solutions
- Positions Tower as foundry for AI infrastructure, data center networking, and advanced telecom customers
Negative
- None.
News Market Reaction
On the day this news was published, TSEM gained 6.43%, reflecting a notable positive market reaction. Argus tracked a peak move of +10.0% during that session. Argus tracked a trough of -6.5% from its starting point during tracking. Our momentum scanner triggered 17 alerts that day, indicating notable trading interest and price volatility. This price movement added approximately $872M to the company's valuation, bringing the market cap to $14.44B at that time. Trading volume was elevated at 3.0x the daily average, suggesting notable buying interest.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
TSEM fell 11.09% while peers were mixed: QRVO up 0.75, SITM down 2.58, SMTC down 6.95, LSCC down 0.64, MTSI down 5.75, pointing to stock-specific pressure rather than a broad sector move.
Previous AI Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Nov 17 | AI power regulator | Positive | -3.9% | Launch of SW2001 buck regulator for AI and server power systems. |
| Aug 25 | AI laser platform | Positive | +5.2% | First on-chip multi-wavelength laser source for AI datacenter fabrics. |
| Aug 12 | AI imager chip | Positive | -0.5% | Cheetah HS ultra‑high‑speed AI-in-imager solution for robotics and inspection. |
| Mar 12 | 400G modulators | Positive | +4.1% | 400G/lane modulators on silicon photonics for AI optical connectivity. |
| Mar 12 | 400G modulators | Positive | +4.1% | 400G/lane modulators enabling scalable high-speed data transfer for AI. |
AI-related announcements often draw mixed reactions, with both positive and negative moves following broadly positive technology news.
Recent AI-focused releases for Tower Semiconductor have highlighted new power-management ICs, advanced laser platforms, high-speed AI imagers, and 400G/lane silicon-photonic modulators. These events, dated between Mar 12, 2025 and Nov 17, 2025, generally described technology progress and ecosystem partnerships for AI datacenters and compute. Price reactions have alternated between gains and declines, suggesting investors react selectively to AI headlines rather than uniformly rewarding every technical milestone.
Historical Comparison
Past AI announcements moved TSEM by an average of 1.8%. Today’s -11.09% drop on a new NVIDIA-linked AI optics update is a notably larger downside reaction.
AI-related news has progressed from modulators and laser sources to power regulators and, now, high-speed silicon photonics for 1.6T data center optical modules.
Market Pulse Summary
The stock moved +6.4% in the session following this news. A strong positive reaction aligns with Tower’s history of market enthusiasm for selected AI and silicon-photonics milestones, where several past AI announcements produced gains. Investors have previously rewarded advances in datacenter optics and AI-focused components. However, past news also shows occasional reversals after initial spikes, so sustainability has varied. Positioning relative to the 200-day MA and overall sector tone would remain important context for any outsized upside move.
Key Terms
silicon photonics technical
AI-generated analysis. Not financial advice.
Tower’s advanced Silicon Photonics platform enables optical and network infrastructure ecosystem with high-speed data transceivers for AI deployments
MIGDAL HAEMEK, Israel – February 05, 2026 –Tower Semiconductor (NASDAQ/ TASE: TSEM), the leading foundry of high value analog semiconductor solutions, today announced it is scaling AI infrastructure deployments with high performance silicon photonics for 1.6T data center optical modules designed for NVIDIA networking protocols. Tower Semiconductor’s silicon photonics enables up to double the data-rate compared to prior silicon photonics solutions, providing increased bandwidth and throughput for optical connectivity, speeding AI application performance on AI infrastructure.
“Tower Semiconductor is proud to deliver advanced, high-speed technologies that support demanding data center and AI requirements,” said Russell Ellwanger, CEO of Tower Semiconductor. “We continue to invest significantly across our SiGe and silicon photonics platforms to support the ecosystem with industry-leading performance, scalability, and manufacturability, enabling customers to advance next-generation data center architectures.”
“The exponential growth of AI is driving the need for a new class of high-speed, scalable networking to connect AI infrastructure,” said Gilad Shainer, Senior Vice President, Networking, NVIDIA. “NVIDIA is collaborating with Tower Semiconductor to advance the ecosystem, enabling more efficient AI infrastructure through next-generation silicon photonics and accelerating AI applications at scale.”
Tower Semiconductor’s SiPho platform is optimized for high-speed optical interconnects, making Tower an ideal foundry for market-leading companies across AI infrastructure, data center networking and advanced telecom.
For additional information about Tower Semiconductor’s SiPho technology platform, 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 SiGe, BiCMOS, mixed-signal/CMOS, RF CMOS, CMOS image sensor, non-imaging sensors, displays, integrated power management (BCD and 700V), photonics, and MEMS. 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 owns one operating facility in Israel (200mm), two in the U.S. (200mm), two in Japan (200mm and 300mm) which it owns through its
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.
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Tower Semiconductor Company Contact: Orit Shahar | +972-74-7377440 | oritsha@towersemi.com
Tower Semiconductor Investor Relations Contact: Liat Avraham | +972-4-6506154 | liatavra@towersemi.com
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FAQ
What did Tower Semiconductor announce with NVIDIA on February 5, 2026 about 1.6T modules (TSEM)?
How will Tower's silicon photonics affect AI data center performance for TSEM shareholders?
Does Tower claim a specific performance improvement for its SiPho technology (TSEM)?
What markets does Tower target with its SiPho platform in the NVIDIA collaboration (TSEM)?
Will the NVIDIA collaboration change Tower's manufacturing role for AI infrastructure (TSEM)?
