The Photonic Fabric — moving data through AI systems with light
HQ: Santa Clara, CA, United States | Founded: 2020 | Employees: ~150 (2026, est.) | Stage: Late Stage VC ($2.5B valuation) | Website: https://celestial.ai
Celestial AI was founded in 2020 by David Lazovsky, a serial entrepreneur and semiconductor industry veteran (previously CEO of InterDigital and founder of multiple deep-tech companies). His thesis: the AI industry's real bottleneck isn't compute — it's data movement. As AI accelerators grew faster, electrical interconnects (both between chips and between chips and memory) became the wall, wasting power and limiting scaling. Celestial AI's answer is the Photonic Fabric: an optical interconnect platform that uses light to move data between compute and memory across the entire system, rather than just between adjacent chips.\n\nThe company positions the Photonic Fabric as solving both connectivity problems at once — compute-to-compute and compute-to-memory — which it argues delivers more AI performance per watt than electrical alternatives. Its technology has attracted major customers across AI chipmakers, hyperscalers, and memory vendors, and it claims a revenue start (~$19.5M ARR in 2025 per third-party estimates) ahead of most peers in the category.\n\nFinancially, Celestial AI raised $100M in Series B, a $175M Series C led by the U.S. Innovative Technology Fund (March 2024), and a $250M round at a $2.5B valuation in March 2025 led by Fidelity Management with BlackRock and Tiger Global — bringing total funding to roughly $589M. As AI data-center interconnect becomes one of the defining infrastructure battles of the decade, Celestial AI is the best-funded challenger to the incumbent electrical-interconnect order, alongside Ayar Labs.
Celestial AI is Ayar Labs' most direct rival in the race to replace electrical interconnects with light — and it brings a different architecture (an optical 'fabric' that also addresses memory) plus heavyweight capital (Fidelity, BlackRock, Tiger Global) and an early revenue start (~$19.5M ARR). The Photonic Fabric targets both compute-to-compute and compute-to-memory connectivity, which its founder argues unlocks more AI efficiency than pure chip-to-chip optics. The bull case is that optical interconnect is inevitable in AI data centers and Celestial has the funding, revenue, and differentiation to win a major share; the bear case is that adoption timelines keep slipping, NVIDIA's roadmap and rivals loom, and the technology must survive a very hard physics-to-volume transition.
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