Salience Labs Inc. has raised $125 million in Series B funding to accelerate its push into optical networking for AI data centers, the company said. The round was led by Bullhound Capital and included participation from the investment arms of Intel and AMD, Intel Capital and AMD Ventures. New investors also included SBI Group, Hudson River Trading and the British Business Bank, while existing backers Applied Ventures, Oxford Science Enterprises, Cambridge Innovation Capital and Silicon Catalyst Ventures returned.
The startup develops all-optical circuit switching technology for AI data centers. According to co-founder and Chief Executive Vaysh Kewada, most data centers still depend on traditional networking fabrics built around electronic switches and repeated optical-to-electrical-to-optical signal conversions. He said those legacy fabrics cannot keep pace with the throughput demands of AI computing clusters that contain tens of thousands of graphics processing units and other accelerators.
Kewada said the gap between available interconnect bandwidth and raw compute capacity produces latency bottlenecks and rising power consumption, which drives up the cost of AI workloads. Salience Labs aims to remove those chokepoints by eliminating electrical signals from the data center and transmitting data only over optical connections. To that end, the company has built an all-optical, fully integrated silicon photonics-based network switch architecture.
The technology targets high-density workloads and routes information directly on-chip rather than feeding large data packets into GPUs electrically. According to the company, that approach delivers lower latency and reduced power consumption and allows operators to scale GPU clusters to hundreds of thousands of chips. Kewada said optical circuit switching will be critical to AI data center networking and that high-performance optical switches are needed as customers deploy optical links.
Salience Labs demonstrated its optical circuit-switching technology at the ECOC 2026 conference in September, showing what it described as the world's first 64-port all-optical photonic switch. The company said the switch validates its approach and provides a foundation for faster communications, with denser 128-port and 256-port configurations under development. Kewada said those devices will support scale-up and scale-out of network fabrics in data-intensive environments.
The company is pursuing a market that Cignal AI forecasts will exceed $8 billion for optical circuit switching by the end of the decade. The new funding will go toward volume manufacturing, geographic market expansion and research and development of higher-density switches. Srini Ananth of Intel Capital said most data center operators recognize that photonic switches are the future and will become common in modern AI factories, adding that Salience Labs stands out through its integrated silicon photonics architecture and proprietary optical amplification.
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