Tel Aviv chipmaker Xsight Labs has banked $300M at a $2.8B valuation, fuel for its push to sell programmable Ethernet silicon to cloud and AI operators.
Fidelity Management & Research led the financing, with Aliya Capital Partners, Atreides Management, Artisan Partners, Battery Ventures, Intel Capital, Maverick Capital, T. Rowe Price and Valor Equity Partners among the participants.
The startup ships two components for data center networks: a data processing unit and an Ethernet switch tuned for AI traffic. Xsight says the switch carries 12.8 terabits per second while drawing under 200 watts, roughly 40% less power than products in the same class.
Its marquee customer is SpaceX, which chose the X2 as the networking core for Starlink V3 satellites. Multiple data center operators have deployed the chips, and hyperscalers are evaluating them, co-founder and CEO Yossi Meyouhas said.
Backers are betting AI data center networking becomes a $150B market by 2028, and that Ethernet standards from the Ultra Ethernet Consortium will close the gap with the proprietary interconnects linking most AI clusters today.
Xsight plans to expand engineering teams in Israel, the US, Europe and Asia, and to boost manufacturing so it can take orders from tier-1 customers. The raise is the latest sign of appetite for alternatives to network chip incumbents like Broadcom and Cisco.
