Marvell’s $540 million acquisition of XConn Technologies underscores how much demand for custom RAN silicon has weakened amid slowing operator investment
Semiconductor company Marvell said it has agreed to acquire XConn Technologies, a specialist in PCIe and CXL switching silicon, expanding its portfolio in data centre connectivity at a time when its traditional RAN silicon business is under pressure. The transaction will see Marvell add XConn’s PCIe and CXL switch products and engineering team to its Ultra Accelerator Link (UALink) scale-up switch programme, with the deal expected to close in early 2026 subject to regulatory approvals.
The move builds on Marvell’s recent acquisition of Celestial AI, announced in late 2025, as the company increases its exposure to AI-driven data centre architectures that rely on high-bandwidth, low-latency interconnects across multi-rack systems. Marvell said the combination of XConn’s switching portfolio and its own CXL memory expansion controllers would create what it described as the industry’s most comprehensive CXL offering for accelerated infrastructure.
“This combination creates a compelling switching platform for accelerated infrastructure, advancing Marvell’s connectivity strategy for next-generation AI and cloud data centers,” said Marvell chairman and CEO Matt Murphy. “With XConn, we add proven PCIe and CXL switch products, IP, and engineering talent to expand our UALink scale-up switch team. Combined with our pending acquisition of Celestial AI, we will be well positioned to deliver customers the performance, flexibility, and architectural choice they need as AI systems grow in size and complexity.”
Custom RAN market in decline
While Marvell continues to supply custom silicon to major RAN vendors, the carrier infrastructure market has been shrinking for several years as mobile operators cut capex following the main phase of 5G rollouts. According to Omdia, global RAN equipment sales fell from $45 billion in 2022 to $35 billion in 2024, with further pressure on vendor margins.
Marvell’s exposure to this slowdown has been compounded by shifts among its largest RAN customers. Samsung and Nokia have historically relied on Marvell’s OCTEON Fusion baseband processors and data processing units, but both vendors are reassessing their hardware strategies. Samsung has increasingly mixed purpose-built platforms with virtualised RAN deployments based on general-purpose processors, while Nokia has signalled a longer-term move towards GPU-based architectures for AI-RAN, 5G Advanced and 6G, reducing its dependence on custom baseband silicon – enter Nvidia.
Ericsson, by contrast, continues to derive most of its RAN revenues from purpose-built platforms, but has also been developing parallel virtualised RAN architectures to enable greater hardware optionality as performance gaps narrow between custom silicon and general-purpose processors. This broader industry shift has made long-term investment in bespoke RAN silicon harder to justify, particularly in a contracting market.
AI futures
Against this backdrop, Marvell’s carrier division revenues have fallen sharply from their peak, prompting a clearer focus on data centre and AI infrastructure, where spending remains robust. XConn’s PCIe 5 and CXL 2.0 switches are already in production, with PCIe 6 and CXL 3.1 devices sampling, and Marvell expects the products to begin contributing revenue in the second half of fiscal 2027.
“At XConn we have built the industry’s highest-port-count advanced PCIe 5 and PCIe 6 switching portfolio to support the next generation of accelerated infrastructure,” said Conn CEO Gerry Fan. “Marvell brings cutting-edge SerDes technology, a leading process roadmap, deep hyperscale customer relationships, and global scale. We share a common vision for high-speed connectivity as the foundation of modern data centres.”
