Palomino Wins First AI Data Center Chip Order

U.S. startup Palomino recently received its first purchase order for gallium nitride (GaN) microLED-based optical interconnect chips for AI infrastructure from a global strategic hyperscaler. According to industry sources, the order also includes a statement of work to improve nanomaterials and microLED designs, increasing optical output and fiber coupling efficiency. Palomino did not identify the customer.

The company says it redesigned microLED technology, previously discussed mainly for displays, for high-speed data transmission in AI data centers, and that the order demonstrates its commercial potential. It is the first publicly confirmed commercial order in which a hyperscaler has bought microLED optical interconnect technology that had been described as being in development for AI data centers. Co-founder and CEO Jeffrey Sears called the order a milestone, saying major AI infrastructure customers recognize the need for technology that maximizes bandwidth, reliability, and energy efficiency.

Big tech companies and semiconductor firms are looking to optical interconnects instead of conventional copper wiring to reduce heat and power consumption in AI data centers. The report says microLEDs operate more reliably at high temperatures and use less energy than existing laser-based technology, while offering terabit-class bandwidth density per millimeter, making them a candidate for next-generation optical technology.

Other companies cited as leaders in the field include Ayar Labs, a silicon photonics startup backed by Samsung Electronics and SK hynix, and Microsoft, which is developing MOSAIC, a microLED optical cable project with MediaTek and others to substantially reduce data center power consumption. An industry source said South Korean companies are also interested, but remain at an early development stage and will need time to become competitive.

U.S. startup Palomino recently received its first purchase order for gallium nitride (GaN) microLED-based optical interconnect chips for AI infrastructure from a global strategic hyperscaler. According to industry sources, the order also includes a statement of work to improve nanomaterials and microLED designs, increasing optical output and fiber coupling efficiency. Palomino did not identify the customer.

The company says it redesigned microLED technology, previously discussed mainly for displays, for high-speed data transmission in AI data centers, and that the order demonstrates its commercial potential. It is the first publicly confirmed commercial order in which a hyperscaler has bought microLED optical interconnect technology that had been described as being in development for AI data centers. Co-founder and CEO Jeffrey Sears called the order a milestone, saying major AI infrastructure customers recognize the need for technology that maximizes bandwidth, reliability, and energy efficiency.

Big tech companies and semiconductor firms are looking to optical interconnects instead of conventional copper wiring to reduce heat and power consumption in AI data centers. The report says microLEDs operate more reliably at high temperatures and use less energy than existing laser-based technology, while offering terabit-class bandwidth density per millimeter, making them a candidate for next-generation optical technology.

Other companies cited as leaders in the field include Ayar Labs, a silicon photonics startup backed by Samsung Electronics and SK hynix, and Microsoft, which is developing MOSAIC, a microLED optical cable project with MediaTek and others to substantially reduce data center power consumption. An industry source said South Korean companies are also interested, but remain at an early development stage and will need time to become competitive.