Tower Semiconductor (NASDAQ: TSEM) secures $1.3B SiPho deals, eyes $2.8B 2028 model

Rhea-AI Filing Summary

Tower Semiconductor Ltd. reports multi-year growth commitments in its silicon photonics business. The company has signed Silicon Photonics (SiPho) contracts targeted to generate $1.3 billion of 2027 revenue with its largest customers and has already received $290 million in customer prepayments for capacity reservations.

The contracts are complemented by an even larger wafer commitment for 2028, with additional prepayments due by January 2027. Tower links these agreements and an ongoing global capacity ramp to its 2028 business model of $2.8 billion revenue and $750 million net profit, centered on high-performance optical connectivity and AI-related applications.

Positive

• Contracted SiPho revenue and prepayments: The company has signed Silicon Photonics contracts aimed at $1.3 billion of 2027 revenue and already received $290 million in customer prepayments for capacity, providing material demand visibility and upfront funding.
• Ambitious 2028 profitability model: Management ties these commitments and capacity expansion to a 2028 model of $2.8 billion revenue and $750 million net profit, indicating a significantly larger and more profitable business target.

Negative

• None.

Insights

Semiconductor industry analyst

Large SiPho contracts and prepayments underpin Tower’s AI‑driven growth plan.

Tower Semiconductor highlights substantial visibility in its Silicon Photonics business by signing contracts aimed at $1.3 billion of 2027 revenue and securing $290 million in capacity prepayments. This suggests strong demand from large customers for high-speed optical connectivity tied to AI infrastructure.

The company also references an even larger contractual wafer commitment for 2028 and aligns these deals with a 2028 model of $2.8 billion revenue and $750 million net profit. These are forward-looking targets, so actual outcomes will depend on execution, capacity ramp-up, and broader AI and data-center spending trends.

Tower points to technology capabilities such as 400GHz/lane modulators, heterogeneously integrated InP/SiPho and TFLN solutions, optical circuit switches, DWDM lasers, and hybrid bonding for 3DIC. Future disclosures in company filings may provide more detail on utilization levels and the timing of additional prepayments due by January 2027.

Key Figures

SiPho 2027 contracted revenue: $1.3 billion Customer prepayments: $290 million 2028 revenue model: $2.8 billion +3 more

6 metrics

SiPho 2027 contracted revenue $1.3 billion Silicon Photonics contracts for 2027 revenue with largest customers

Customer prepayments $290 million Prepayments received for Silicon Photonics capacity reservation

2028 revenue model $2.8 billion Management’s 2028 revenue target linked to SiPho capacity ramp

2028 net profit model $750 million Management’s 2028 net profit target tied to SiPho growth

Active SiPho customers over 50 customers Rich and broad Silicon Photonics customer base across applications

Modulator/detector speed 400GHz/lane Performance demonstrated in native SiPho and heterogeneous platforms

Key Terms

Silicon Photonics (SiPho), Near-Packaged Optics (NPO), Co-Packaged Optics (CPO), DWDM lasers, +2 more

6 terms

Silicon Photonics (SiPho) technical

"announced it has signed Silicon Photonics (SiPho) contracts for $1.3 billion for 2027 revenue"

Near-Packaged Optics (NPO) technical

"support the market across today’s high-volume pluggable optical transceivers as well as next-generation Near-Packaged Optics (NPO)"

Co-Packaged Optics (CPO) technical

"as well as next-generation Near-Packaged Optics (NPO) and Co-Packaged Optics (CPO) solutions"

Co-packaged optics (CPO) are a way of placing optical transmitters and receivers directly next to or on the same chip package as a high-speed switch or processor, rather than keeping them on separate circuit boards. By moving the light-based communications closer to the switching brain, CPO cuts power use, reduces delay and can greatly increase data capacity — changes that can lower operating costs, enable denser data centers, and shift competitive dynamics among hardware suppliers and cloud operators.

DWDM lasers technical

"high-performance high-power DWDM lasers for “wide and slow” CPO architectures"

3DIC integration technical

"and our hybrid-bonding capability for 3DIC integration"

forward-looking statements regulatory

"This press release includes forward-looking statements, which are subject to risks and uncertainties."

Forward-looking statements are predictions or plans that companies share about what they expect to happen in the future, like estimating sales or profits. They matter because they help investors understand a company's outlook, but since they are based on guesses and assumptions, they can sometimes be wrong.

Form 6-K: How Foreign Companies Report to the SEC →

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of May 2026 No.4

Commission File Number 0-24790

TOWER SEMICONDUCTOR LTD.

(Translation of registrant's name into English)

Ramat Gavriel Industrial Park

P.O. Box 619, Migdal Haemek, Israel 2310502

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

On May 13, 2026, the Registrant Announced Signing of Customer

Contracts for $1.3 Billion Silicon Photonics Revenue for 2027

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TOWER SEMICONDUCTOR LTD.
Date: May 13, 2026	By:	/s/ Nati Somekh
		Name:  Nati Somekh
		Title:  Corporate Secretary

          

Tower Semiconductor Signs Customer Contracts for $1.3 Billion Silicon Photonics Revenue for 2027

2028 Contracts Demonstrate Substantially Higher Sipho Capacity Reservations

Customer Prepayments of $290 Million Have Been Received

MIGDAL HAEMEK, Israel, May 13, 2026 - Tower Semiconductor (NASDAQ/TASE: TSEM), the leading foundry for high-value analog semiconductor solutions, today announced it has signed Silicon Photonics (SiPho) contracts for $1.3 billion for 2027 revenue with its largest customers, and the receipt of $290 million in customers’ prepayments for capacity reservation. This initial commitment is further reinforced by an even larger contractual wafer commitment for 2028 for which additional associated prepayments are due by January 2027. These financial commitments underscore Tower's market leadership and highlight the critical role of its world-leading Silicon Photonics technology platform in meeting the rapidly growing industry demand.

The pre-paid capacity reservation is the customer contractual commitment, with their full demand and Tower shipment forecast being higher. The total 2027 customer demand is further augmented by healthy forecasts from the rich and broad SiPho customer base of over 50 active customers across wide-ranging SiPho based applications.

To support this accelerating demand, Tower is in the midst of substantial capacity ramp to expand its worldwide multi-fab SiPho capacity, the foundation to achieve the 2028 model of $2.8 billion revenue with $750 million net profit in 2028.

“These long-term agreements further strengthen Tower’s strategic position at the center of the rapidly expanding optical connectivity market,” said Russell Ellwanger, Chief Executive Officer of Tower Semiconductor. “These multi-year customer commitments underscore both the depth of our strategic partnerships and our customers’ strong confidence in Tower’s ability to execute on a differentiated, multi-generational silicon photonics technology roadmap addressing the accelerating performance demands driven by AI infrastructure growth. With our unique manufacturing scale, technology breadth, and expanding global capacity, we are well positioned to support the market across today’s high-volume pluggable optical transceivers as well as next-generation Near-Packaged Optics (NPO) and Co-Packaged Optics (CPO) solutions, enabling the continued scaling of data center bandwidth, power efficiency, and connectivity performance.”

 Tower is enabling the explosive demand for AI, not only through aforementioned aggressive capacity expansion, but also through strategic investments in capabilities to enable next generation of Scale-out, Scale-across and Scale-up architectures for training and inference AI hardware. A subset of previously announced capabilities include: 400GHz/lane modulator and detector performance demonstrated both in our native SiPho platform as well as in heterogeneously integrated InP/SiPho and TFLN; SiPho based optical circuit switches for ultra-low latency all-optical networks; high-performance high-power DWDM lasers for “wide and slow” CPO architectures; and our hybrid-bonding capability for 3DIC integration.

Furthermore, Tower is actively engaged with key customers on the development of a variety of next-generation modulators, including TFLN, InP, and organic materials for ultra-high bandwidth, as well as Microring Modulators, Si-based Electro-Absorption modulators, and uLEDs for ultra-dense parallel data transmission. Most importantly, Tower continues to partner closely with the industry leading innovators to bring the best of Silicon Photonics technology to market for generations to come.

For additional information about Tower Semiconductor’s SiPho and SiGe 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 SiPho, SiGe, BiCMOS, mixed-signal/CMOS, RF CMOS, CMOS image sensor, non-imaging sensors, displays, integrated power management (BCD and 700V), 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 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 51% holdings in TPSCo and shares a 300mm facility in Agrate, Italy with STMicroelectronics. For more information, please visit: www.towersemi.com.

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. 

###

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

FAQ

What did Tower Semiconductor (TSEM) announce in its May 2026 Form 6-K?

Tower Semiconductor announced it has signed Silicon Photonics contracts targeting $1.3 billion in 2027 revenue with major customers and received $290 million of customer prepayments for capacity reservations, supporting its planned expansion in optical connectivity and AI-related applications.

How large are Tower Semiconductor’s 2027 silicon photonics contracts?

The company reports signed Silicon Photonics contracts for $1.3 billion in 2027 revenue with its largest customers. This contracted amount is described as an initial commitment, with full customer demand and Tower’s shipment forecast characterized as higher than the pre-paid capacity reservation.

How much in prepayments has Tower Semiconductor received for SiPho capacity?

Tower Semiconductor states it has received $290 million in customer prepayments tied to capacity reservations for its Silicon Photonics business. These prepayments are part of long-term agreements with large customers and are linked to contracted 2027 revenue and future 2028 wafer commitments.

What 2028 financial model did Tower Semiconductor describe for TSEM?

The company references a 2028 business model targeting $2.8 billion in revenue and $750 million in net profit. This model is associated with substantial SiPho capacity expansion and larger contractual wafer commitments for 2028, focused on fast-growing optical connectivity and AI infrastructure demand.

How do the new contracts affect Tower Semiconductor’s silicon photonics positioning?

Management says the multi-year SiPho contracts strengthen Tower’s position in the expanding optical connectivity market. They emphasize long-term customer partnerships, confidence in its multi-generational silicon photonics roadmap, and support for applications like pluggable transceivers, Near-Packaged Optics, and Co-Packaged Optics.

What technologies is Tower Semiconductor developing to support AI and SiPho demand?

Tower highlights 400GHz/lane modulators and detectors, heterogeneously integrated InP/SiPho and TFLN platforms, SiPho optical circuit switches, high-power DWDM lasers, and hybrid bonding for 3DIC. It is also working with customers on next-generation modulators and uLED-based ultra-dense parallel data transmission.