Analog Devices buys Empower Semiconductor for 15bn TNW
Analog Devices is acquiring Empower Semiconductor for $1.5 billion in cash to strengthen its power-delivery technology for AI data centres. The deal gives ADI access to Empower's integrated voltage regulators, which can cut system power consumption by roughly 20%.TL;DR
Analog Devices has agreed to buy Empower Semiconductor for $1.5 billion in cash, placing a major bet that the insatiable energy demands of AI data centres will keep chipmakers scrambling for better power-delivery technology.
The deal, announced on Monday, gives the Wilmington, Massachusetts-based chipmaker access to Empower's integrated voltage regulators, which sit directly beneath AI accelerators and feed current vertically through the circuit board rather than routing it sideways. According to Empower, that design can trim roughly 20% of a system's total power consumption, a figure that matters enormously when a single hyperscale facility can draw hundreds of megawatts.
“AI infrastructure is fundamentally reshaping how power must be delivered, with energy now the most persistent constraint to scaling next-generation systems,” said Vincent Roche, chief executive and chair of Analog Devices.
Roche added that Empower's technology will expand ADI's portfolio and help its customers “achieve the compute densities next-generation AI demands.” Tim Phillips, who co-founded Empower in 2014 and serves as its chief executive, will stay on to oversee integrated voltage regulator development within ADI.
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Empower, based in Milpitas, California, has been on a rapid growth trajectory. In September 2025 it closed a Series D round of more than $140 million led by Fidelity Management & Research, with participation from Maverick Silicon, CapitalG, Atreides Management, and several other investors. That round brought total funding to roughly $236 million across multiple rounds. The company also opened a new corporate headquarters in Milpitas and a dedicated research and development centre in Munich late last year, signalling ambitions well beyond its Silicon Valley roots.
The acquisition arrives as billions of dollars pour into AI infrastructure from chipmakers and hyperscalers alike. Nvidia alone has committed more than $40 billion in AI equity bets so far in 2026, while Meta recently signed a $27 billion data-centre deal with Nebius. Power efficiency has become a central competitive axis: startups are racing to curb data-centre energy use even as workloads balloon.
For Analog Devices, the timing is notable. The company reports second-quarter earnings on Tuesday, with analysts expecting record revenue of roughly $3.5 billion. Its shares have gained more than 52% this year, pushing ADI's market capitalisation above $200 billion. PJT Partners advised Analog Devices on the transaction, while Barclays acted for Empower.
Analog Devices, which designs and manufactures chips for industrial, automotive, communications, and consumer-electronics markets, has been on its own hot streak. The company is the third-largest US-listed chipmaker not primarily focused on processors, and the Empower deal marks its biggest acquisition in years.
The transaction is expected to close in the second half of 2026, subject to regulatory clearance under the Hart-Scott-Rodino Act. If it goes through, ADI will fold Empower's FinFast technology and Crescendo power platform into its existing grid-to-core power portfolio.
Whether the deal proves to be a bargain or a premium depends on how quickly AI power budgets keep climbing, but early reports had already flagged that both sides were close to agreement. With energy costs now rivalling silicon itself as the bottleneck in AI scaling, Analog Devices is betting that the chips closest to the processor will be the ones that matter most.