Credo Technology Group to Acquire Israel’s DustPhotonics for Up to $350 Million

U.S. based semiconductor company Credo Technology Group has signed an agreement to acquire Israeli startup DustPhotonics in a deal valued at up to $350 million, according to reports.

The transaction includes an upfront payment alongside performance-based earnouts, reflecting expectations for continued growth in the optical connectivity market. DustPhotonics, which develops advanced optical interconnect solutions, will be integrated into Credo’s operations as part of its strategy to expand its presence in AI-driven data center infrastructure.

Founded in Israel, DustPhotonics focuses on high-speed optical DSP (digital signal processing) and connectivity modules that enable faster and more efficient data transfer between servers. These capabilities are becoming increasingly critical as artificial intelligence workloads and cloud computing demands accelerate.

The acquisition aligns with a broader industry shift toward optical technologies as a solution to bandwidth and power constraints in next-generation data centers. For Credo, the deal is expected to enhance its ability to deliver high-performance connectivity solutions to hyperscalers and enterprise customers.

Beyond the technology, the deal highlights the continued attractiveness of Israel’s semiconductor and deep-tech ecosystem, as global companies seek to strengthen their capabilities in areas supporting AI infrastructure.