Infineon to acquire Marvell's automotive Ethernet business for $2.5 billion
Infineon announced on April 7 local time that it would acquire the automotive Ethernet business of Marvell Technology, a US chipmaker. The two parties have signed a final transaction agreement and the acquisition price is US$2.5 billion in cash.
The automotive Ethernet business will become part of Infineon's automotive division and is expected to generate revenue of US$225 million to US$250 million in calendar year 2025, with a gross profit margin of nearly 60%.
Infineon has obtained acquisition financing from banks and will assume additional debt to finance the transaction, which is expected to be completed this year.
"Marvell has made it clear that they are an AI-first company focused on custom silicon and networks," said CJ Muse, senior managing director at Cantor Fitzgerald.
"Against this backdrop, automotive Ethernet is no longer the focus, so it makes sense that they are willing to sell at the right price. At 10 times sales, this is a pretty attractive price."
Marvell shares rose nearly 4% in after-hours trading on Monday. The company expected its first-quarter revenue to be in line with Wall Street expectations last month.
Analysts at JPMorgan attributed the tepid forecast to "slower growth in internal data center products," referring to weaker demand for Ethernet cables and Fiber Channel that carry data between servers.
Infineon sees the acquisition as a way to accelerate its software-defined automotive systems capabilities, complementing and expanding its market-leading microcontroller business.
Marvell sells automotive Ethernet business to Infineon for $2.5 billion in cash
Marvell announced today that it has entered into a definitive agreement under which Infineon Technologies AG ("Infineon") will acquire Marvell's automotive Ethernet business in an all-cash transaction valued at $2.5 billion. The business is expected to generate revenues of between $225 million and $250 million in fiscal 2026. The acquisition includes Marvell's Brightlane automotive Ethernet portfolio and related assets. The transaction has been approved by Marvell's board of directors and is expected to close in calendar year 2025, subject to customary closing conditions and regulatory approvals.
Infineon said that Ethernet is a key enabling technology for low-latency, high-bandwidth communications, which is essential for software-defined cars. In addition, it also has great potential in adjacent application areas such as humanoid robots. This planned investment will strengthen Infineon's already strong presence in the United States, including extensive R&D activities.
Infineon CEO Jochen Hanebeck said: "As the world's number one supplier of semiconductor solutions for the automotive industry, this acquisition is of great strategic significance to Infineon. We will use this highly complementary Ethernet technology and combine it with our existing broad product portfolio to provide customers with more comprehensive and leading software-defined automotive solutions. This transaction will support our future profitable growth strategy, including new opportunities in the field of physical AI such as humanoid robots."
Marvell's leading Brightlane automotive Ethernet PHY transceiver, switch and bridge product portfolio supports network data rates from today's 100 Mbps (megabits per second) to the market-leading 10 Gbps (gigabits per second). It also supports the security features required for today's and future in-vehicle networks.
Marvell's Automotive Ethernet business counts more than 50 automakers among its customers, including eight of the top ten leading OEMs. Strong customer relationships, backed by approximately $4 billion in design wins through 2030 and a strong innovation roadmap, pave the way for future revenue growth. The business is expected to generate revenues of $225 million to $250 million in calendar year 2025, with gross margins of approximately 60%, driven by significant potential for further acceleration from Infineon's unrivaled global automotive customer channel. Additional cost synergies are expected to be achieved by combining R&D efforts and leveraging Infineon's production footprint. Marvell's Automotive Ethernet business has hundreds of highly skilled and dedicated employees with major offices in the United States, Germany and Asia. Upon closing of the transaction, Marvell's Automotive Ethernet business will become part of Infineon's Automotive Division.
Ethernet connectivity solutions are essential for software-defined cars and are the foundation for efficient E/E architectures, including central computing, regional and endpoints. Complex features such as advanced driver assistance systems, autonomous driving and over-the-air software updates require large amounts of secure data processing, networking and storage. The combination with Infineon's AURIX™ microcontroller family creates a comprehensive product portfolio that combines communication solutions and real-time control. The acquisition is intended to further strengthen Infineon's leading position in microcontrollers.
Infineon will finance the acquisition of Marvell's automotive Ethernet business in an all-cash transaction using existing liquidity and assuming additional debt. Infineon has obtained acquisition financing from banks. The transaction is subject to customary closing conditions, including regulatory approvals, and is expected to close in 2025.
"Marvell has transformed into a leading provider of data infrastructure solutions, with the data center end market contributing 75% of consolidated revenue in the fourth quarter of fiscal 2025," said Matt Murphy, Chairman and CEO of Marvell. "We are extremely proud of the progress we have made in organically growing our automotive Ethernet business. Given its attractive valuation, we believe this transaction will deliver the strongest financial return to Marvell shareholders. With Infineon's platform optimized for automotive applications, we believe the automotive Ethernet business is well positioned for continued growth and success."
