Cisco Acquires Luxtera for Optical Chips

Cisco Systems is acquiring Luxtera Inc., an optics-focused semiconductor company, the networking company confirmed this morning. Rumors about the buyout had swirled in recent weeks.

Luxtera, founded in 2001, specializes in silicon photonics — the use of a standard semiconductor wafer foundry to produce optical-electrical transceiver products. Those products, in turn, can move large amounts of data at high speeds over long distances, the company says.

Cisco plans to incorporate Luxtera’s technology across its intent-based networking portfolio, spanning enterprise, data center and service provider markets, the company says.

Explaining the deal, Cisco Head of Investments  said:

“As system port capacity increases from 100GbE to 400GbE and beyond, optics plays an increasingly important role in addressing network infrastructure constraints, particularly density and power requirements. The combination of Cisco’s and Luxtera’s capabilities in 100GbE/400GbE optics, silicon and process technology will enable customers to build future-proof networks optimized for performance, reliability and cost.”

Cisco will pay $660 million in cash and assumed equity awards for Luxtera. The deal is expected to close in the third quarter of Cisco’s fiscal year 2019.

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