Marvell Technology is expanding its position in the AI infrastructure market with a $540 million acquisition of XConn Technologies, a provider of advanced networking and interconnect technology. The deal, structured with roughly 60% cash and 40% stock, aims to strengthen Marvell’s networking portfolio for AI and cloud data centers.
Marvell’s purchase of XConn is part of a broader strategy to enhance its role in data center connectivity and accelerate its growth in AI-related hardware solutions. The acquisition is expected to close in early 2026 and contribute to Marvell’s sales and profits beginning in the second half of fiscal 2027. Analysts anticipate XConn products could generate around $100 million in revenue by fiscal 2028.
Strategic Expansion in AI Data Center Connectivity
Marvell’s acquisition brings XConn’s PCIe and CXL switching silicon into its product lineup, broadening the company’s switching portfolio. XConn’s technology supports high-performance data transfer across servers and accelerators, which is critical for AI workloads in data centers. The added expertise and talent from XConn’s team are expected to complement Marvell’s existing solutions and improve its competitive position in the market.
This move follows Marvell’s recent acquisition of optical interconnect startup Celestial AI, highlighting the company’s ongoing focus on expanding its infrastructure offerings for AI and cloud environments.
Cash and Stock Deal Terms
Under the terms of the agreement, Marvell will fund the transaction through a combination of cash and stock. About 60% of the purchase price will be paid in cash, while the remaining 40% will be in Marvell stock. The stock portion is based on Marvell’s 20-day volume-weighted average price and is expected to represent around 2.5 million shares.
The deal is subject to customary closing conditions and regulatory approvals before finalization in early 2026. Marvell plans to benefit from XConn’s technology and engineering talent to accelerate its connectivity strategy for next-generation AI and cloud data centers.
Market Reaction and Competitive Landscape
Marvell’s announcement was met with mixed reactions in the market. Shares of the company have experienced both gains and declines in trading, reflecting investor sentiment about the acquisition’s potential impact and the timing of revenue contributions. Despite a challenging year with strong competition from rivals like Broadcom and Nvidia, Marvell’s shares rose following the announcement, indicating some investor optimism about its strategic direction.
XConn’s interconnect solutions will help Marvell address data center networking demands, particularly for high-speed data transfer between CPUs, GPUs, accelerators, and memory.
Looking Ahead: AI Infrastructure Growth
By integrating XConn’s technology, Marvell aims to offer more comprehensive networking solutions tailored to the evolving requirements of AI data centers. This expansion aligns with broader trends in the semiconductor industry, where demand for high-performance interconnect and switching technologies has grown alongside advancements in AI computing.
The acquisition underscores Marvell’s commitment to strengthening its portfolio and competing more effectively in the AI infrastructure space. With expected revenue contributions from XConn products and added engineering expertise, Marvell is positioning itself to capture opportunities in the rapidly expanding market for AI and cloud data center connectivity.
