Salience Labs raises $125M after showcasing world’s most advanced, fully optical circuit-switching tech

Salience Labs raises $125M after showcasing world’s most advanced, fully optical circuit-switching tech

A startup called Salience Labs Inc. wants to play a bigger role in speeding up artificial intelligence workloads after raising $125 million in a Series B funding.

Today’s round was led by Bullhound Capital and saw the two of the chipmaking industry’s most iconic names participate via their investment arms, Intel Capital AMD Ventures. SBI Group, Hudson River Trading and the British Business Bank were also named as new investors, while existing backers including Applied Ventures, Oxford Science Enterprises, Cambridge Innovation Capital and Silicon Catalyst Ventures returned to get involved again.

Salience Labs is the developer of specialized all-optical circuit switching technology for AI data centers, and it has attracted a lot of interest thanks to the unprecedented strain being placed on existing infrastructure. As co-founder and Chief Executive Vaysh Kewada explains, most data centers today still rely on traditional networking fabrics based on electronic switches and repeated optical-to-electrical-to-optical signal conversions to keep traffic flowing efficiently.

But Kewada says the problem is that they’re not, in fact, that efficient, because these legacy fabrics simply cannot keep up with the massive throughput demands of AI computing clusters made up of tens of thousands of graphics processing units and other accelerators. The available interconnect bandwidth is seriously lagging behind that of the raw compute capacity now available, resulting in latency bottlenecks and growing power consumption that dramatically drives up the cost of AI workloads.

Kewada is convinced that the best way to get rid of these networking chokepoints is to eliminate electrical signals in the data center completely, and that means making sure data is only transmitted over optical connections. To do this, Salience Labs has developed an all-optical and fully integrated silicon photonics-based network switch architecture.

It’s targeted at high-density workloads, and instead of feeding massive data packets into GPUs electrically, it dynamically routes information directly on-chip, ensuring that it arrives at its destination much more rapidly. This results in much lower latency and significantly reduced power consumption, paving the way for companies to scale their GPU clusters to hundreds of thousands of chips.

“Optical circuit switching will play a critical role in AI data center networking,” Kewada said. “As customers roll out optical links in their data centers, high-performance optical switches are needed to deliver the token economics that AI workloads demand.”

Salience Labs recently demonstrated the most advanced version of its optical circuit-switching tech at the ECOC 2026 conference in September, showcasing the world’s first 64-port all-optical photonic switch. The company said the switch not only validates its approach to optical switching, but also lays the groundwork for even more rapid communications, with denser 128-port and 256-port configurations now under development.

These devices will support the “scale-up and scale-out” of network fabrics across data-intensive environments, Kewada promised. It’s targeting a massive opportunity too, with data from Cignal AI forecasting the market for optical circuit switching to grow to more than $8 billion by the end of the decade. Today’s funding round will help to ensure it grabs a piece of this pie, with the money set to be directed toward volume manufacturing and geographic market expansion, as well as the research and development of the company’s higher-density switches.

Intel Capital’s Srini Ananth said most data center operators already recognize that photonic switches are the future and will soon become omnipresent in all modern AI factories. “Optical switching can unlock significant gains in performance and efficiency,” he said. “Salience Labs stands out through its integrated silicon photonics architecture and proprietary optical amplification, addressing key challenges to deploying optical switching at scale.”

Images: Salience Labs