NVIDIA and Corning Collaborate on Increasing Optical Connectivity Capacity by 10 Times

NVIDIA is extending the competition for AI infrastructure from chips to fiber optics.

On May 6th, NVIDIA reached a multi-year commercial and technological partnership with Corning. According to the agreement, Corning will build three advanced manufacturing plants in North Carolina and Texas, dedicated to producing optical connectivity solutions specifically for NVIDIA, a move that will create over 3,000 high-paying jobs. NVIDIA invested $500 million to obtain equity subscription rights for Corning, securing two immediately exercisable warrants (to purchase up to 3 million shares at $0.0001 per share, and up to 15 million shares at $180 per share).

Corning plans to increase its optical connectivity manufacturing capacity in the US by 10 times, and fiber optic production by more than 50%. This expansion directly responds to the increased demand driven by the accelerated construction of AI factories. The two companies stated that modern AI workloads require thousands of NVIDIA GPUs, thereby presenting an unprecedented scale of demand for high-performance fiber optics, connectors, and photonic components.

The market responded positively to this, with Corning's US stock soaring by 12%. The company's stock has risen more than 250% over the past year. This partnership further clarifies the strategic position of optical connectivity in AI infrastructure.

NVIDIA Obtains Corning Warrants for $500 Million

NVIDIA spent $500 million to obtain the equity subscription rights for Corning, which is part of the broader cooperation between the two companies to expand AI infrastructure.

The regulatory filing submitted by Corning on Wednesday indicates that NVIDIA received two warrants: one prepaid warrant, which allows the purchase of up to 3 million Corning shares at a nominal exercise price of $0.0001 per share; and another traditional warrant, which allows the purchase of up to 15 million shares at an exercise price of $180 per share. Both warrants are exercisable immediately and have a validity period of three years.

In exchange, Corning committed to increasing US fiber optics capacity by more than 50% to supply more fiber optics to AI data centers. These data centers rely on optical cables to transmit data at high speeds between devices, including NVIDIA's chips.

Copper Retreats, Fiber Optics Advances: From Cabinet to Chip Level

The core technological path of this cooperation is "co-packaged optics". According to a CNBC report quoting analysts, NVIDIA is likely planning to replace copper cables with Corning fiber optics in its AI rack-level systems.

Traditionally, data centers use copper cables to connect components within server cabinets. As the number of GPUs has risen from hundreds to thousands, the signal transmission distance has increased, and the signal attenuation and power consumption issues associated with copper cables have become more pronounced. Fiber optics transmit data using photons rather than electrons, with power consumption only one-fifth to one-twentieth that of copper cables.

Corning CEO Wendell Weeks said in January that by placing the optical conversion process directly next to computer chips, data only needs to travel a few millimeters, significantly less than the distance across a circuit board, thereby significantly reducing power consumption. Omdia enterprise infrastructure analyst Vlad Galabov added that fiber optics have less signal loss, which can speed up reliable communication speed and shorten the required distance between hundreds of thousands of GPUs within data centers.

NVIDIA's Optical Layout: Investment and Integration in Parallel

NVIDIA's layout in the field of optical connectivity did not start with this cooperation. In March 2025, NVIDIA invested $4 billion in Coherent and Lumentum, two companies that develop lasers and components for converting data between optical and electrical signals, which are then transmitted via Corning's fiber optics.

In 2025, NVIDIA released two network switches that use co-packaged optical technology, placing optical engines directly next to switch chips to shorten signal transmission distances and reduce energy consumption. NVIDIA's competitors are also following suit. Broadcom and Marvell Technology have introduced similar products, and Intel is also developing co-packaged optical solutions.

Corning's Strategic Transformation: From iPhone Screens to AI Infrastructure

Corning is