Tower Semiconductor signs silicon photonics contracts for $1.3B

Tower Semiconductor (TSEM) announced it has signed silicon photonics contracts for $1.3B for 2027 revenue with its largest customers, and the receipt of $290M in customers’ prepayments for capacity reservation. This initial commitment is further reinforced by an even larger contractual wafer commitment for 2028 for which additional associated prepayments are due by January 2027. The pre-paid capacity reservation is the customer contractual commitment, with their full demand and Tower shipment forecast being higher. To support this accelerating demand, Tower is in the midst of substantial capacity ramp to expand its worldwide multi-fab silicon photonics capacity, the foundation to achieve the targeted model of $2.8B revenue with $750M net profit in 2028.