IQE plc and Tower Semiconductor have announced a multi-year agreement for the supply of indium phosphide (InP) epiwafers to support optical connectivity solutions in AI-driven data center infrastructure. The partnership is designed to strengthen supply for next-generation silicon photonics technologies while supporting both companies’ long-term growth strategies.

Under the agreement, IQE will provide InP epiwafers for several of Tower’s advanced silicon photonics platforms. These materials are expected to form a critical part of Tower’s product roadmap by enabling high-performance optical technologies used in modern data center environments.

Enabling Next-Generation Optical Performance

The collaboration includes development support for high-speed applications such as 200Gb per second per lane pluggable transceivers and the prototyping of next-generation 400Gb per lane modulators. The agreement also covers additional photonic applications, including optical circuit switches intended for deployment in data centers.

To ensure supply continuity, the agreement includes a minimum purchase commitment from Tower in the first year, alongside a reciprocal supply commitment from IQE. Both companies have also agreed to minimum volume commitments in subsequent years, providing a structured framework for scaling production.

IP Dispute Resolved Through Separate Agreement

In parallel with the supply deal, IQE and Tower have resolved all prior intellectual property disputes between them. As part of the settlement, Tower will grant IQE a broad, worldwide, royalty-free license to porous silicon patents that had been the subject of litigation.

The resolution removes previous legal uncertainties and enables closer collaboration between the companies on future photonics development.

Supporting AI Infrastructure Expansion

IQE CEO Jutta Meier said the agreement reinforces the company’s position in hyperscale cloud and AI infrastructure markets, highlighting its experience in InP epitaxy and high-volume manufacturing capabilities.

Tower Semiconductor President Dr. Marco Racanelli added that the partnership will integrate InP high-performance components into Tower’s mature silicon photonics platform. He noted that this combination is expected to deliver both the performance and production volumes required to scale future AI infrastructure capacity.

The agreement reflects growing industry demand for advanced materials and photonics technologies as AI data centers continue to expand globally.

15 June 2026