AMD has acquired silicon photonics startup Enosemi.

Terms of the deal were not disclosed but, in a statement, AMD said the acquisition extends the relationship between the two companies, with Enosemi having previously collaborated with the chipmaker as an external development partner on photonics.

Silicon photonics has long been touted as a solution to help data centers deal with increasing bandwidth demands and improve connectivity between servers and switches. The technology involves using silicon instead of glass as the light-transport medium to create photonic integrated circuits.

AMD has also previously invested in optical interconnect startup Celestial AI via its investment arm, AMD Ventures.

Founded in 2023 and headquartered in Silicon Valley, Enosemi designs custom materials to support silicon photonics product development.

“The elite team of experts and PhD-level talent at Enosemi… has a proven track record of building and shipping photonic integrated circuits in volume, a unique feat that few select teams have accomplished,” the statement continued. “Their depth of experience, technical rigor, and track record of execution make them an ideal fit for AMD as we push deeper into high-performance interconnect innovation.”

AMD said that as part of the team, Enosemi will allow it to “scale our ability to support and develop a variety of photonics and co-packaged optics solutions across next-gen AI systems,” strengthening the company’s position as a provider of full-stack AI solutions.

The acquisition of Enosemi is the second deal closed by AMD in three months, following its $4.9bn acquisition of ZT this March, with the division joining the AMD Data Center Solutions business unit led by AMD executive vice president Forrest Norrod.

The company plans to offer end-to-end AI solutions, utilizing a combination of AMD hardware, from CPUs and GPUs to networking silicon. However, while AMD will keep the AI systems design businesses at ZT, it has sold off the manufacturing arm to Sanmina for $3bn.