Securing leadership in integrated voltage regulator technology
2030 AI data center revenue target raised to more than $3 billion
onsemi announced on November 4 that it had signed an agreement to acquire integrated voltage regulator (IVR) technology company Ferric for $600 million in cash. The agreement provides for additional payments of up to $175 million if specified revenue targets are met. Through the acquisition, onsemi plans to secure high-density, high-efficiency power delivery technology for next-generation AI processors and expand its AI data center business.
Reflecting the acquisition, onsemi set its 2030 AI data center revenue target at more than $3 billion, an increase of $500 million from its previous target. It also expects growth in the IVR business to accelerate over the next several years. As the business expands, the company expects positive effects on its long-term targets for revenue growth, gross margin and earnings per share (EPS).
Ferric's IVR technology is central to the acquisition. As AI processors increase in computing performance and power consumption, power delivery technologies that reduce power losses, increase power density and respond quickly to rapidly changing power demand are becoming more important. Power architectures are consequently evolving to move voltage regulation away from the power source and closer to the processor.
IVR technology integrates power conversion directly into the processor package or substrate. Ferric's IVR technology combines a power controller, field-effect transistors (FETs), inductors and capacitors in a single compact package. This can reduce board area by 50% to 70% compared with conventional voltage regulator solutions based on discrete components, while delivering high power closer to the processor.
Placing power conversion circuitry close to the processor shortens the power delivery path, reducing losses and enabling a rapid response to abrupt changes in processor load. In AI data centers, this allows more system power to be used for actual computation and helps increase AI computing throughput relative to power consumption.
Ferric has more than 10 years of engineering experience in integrated voltage regulation and advanced magnetic components and holds more than 40 patents. onsemi plans to combine Ferric's magnetic component and power conversion technologies and engineering staff with its own product development and volume manufacturing capabilities, operational scale and customer network to advance IVR commercialization and market expansion.
Hassane El-Khoury, chairman and CEO of onsemi, said rapid AI growth was increasing processor performance and power consumption, changing power delivery requirements. El-Khoury said the acquisition, combined with onsemi's power solutions portfolio, would expand opportunities for product adoption as AI processor architectures evolve and strengthen its ability to support customers.
Noah Sturcken, founder and CEO of Ferric, said integrated power architectures would play an increasingly important role in future AI data centers. Sturcken said onsemi's manufacturing capabilities and customer base could accelerate adoption and large-scale commercialization of IVR technology.
The transaction is expected to close by the end of 2026, subject to customary closing conditions. onsemi will fund the acquisition with cash on hand, and approximately 50 Ferric employees based in New York and Silicon Valley will join onsemi. The company expects the transaction to have a limited near-term effect on its financial results after closing.
Original Korean article: elec4.co.kr
English brief by Korea Wind Intelligence, koreawindintel.com
