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AMD has acquired Enosemi, a startup designing custom materials to support silicon photonics product development. The terms of the deal, announced Wednesday, weren’t disclosed.

Silicon photonics uses light — photons — to transmit data, offering a faster and more efficient alternative to traditional electrical communication. AMD and other chipmakers have shown an increasing interest in the tech. Late last year, AMD reportedly teamed up with several Taiwan startups for a silicon photonics R&D collaboration.

AMD says that its acquisition of Enosemi will “accelerate [its] co-packaged optics innovation for AI systems.”

“As AI models grow larger and more complex, the need for faster, more efficient data movement is accelerating,” Brian Armick, SVP of tech and engineering at AMD, wrote in a blog post. “Enosemi has collaborated with us as an external development partner on photonics, and this acquisition extends that successful relationship. Now, as part of AMD, the team will help us immediately scale our ability to support and develop a variety of photonics and co-packaged optics solutions across next-gen AI systems.”

Enosemi, based in Silicon Valley, builds and ships photonic integrated circuits — microchips containing two or more photonic components that form a functioning circuit. Founded in 2023 by Ari Novack and Matthew Streshinsky, both of whom have a background in semiconductor engineering, Enosemi offers products including optical interconnects, which integrate computing and networking components inside a data center.

Prior to its exit, Enosemi raised $150,000 in VC funding from backers including New Mexico Vintage Fund. The company had 16 employees as of May, according to Pitchbook.

Novack’s LinkedIn profile now lists him as a silicon design engineering fellow at AMD.

Enosemi is AMD’s first acquisition following the company’s massive deal to buy ZT Systems, for which the former originally paid around $4.9 billion. (AMD reached an agreement to sell ZT Systems’ server-manufacturing business for $3 billion earlier this month.)

The company is doubling down on its AI investments; in 2024, AMD’s AI chip revenue reached $5 billion, CEO Lisa Su said during an earnings call in February.