Onsemi, the Scottsdale-based semiconductor giant, announced on Monday that it has agreed to acquire Ferric Inc., a startup that builds power-delivery chips for artificial intelligence processors, in a deal worth up to $775 million. The agreement calls for $600 million in cash at closing, with another $175 million possible if Ferric hits certain revenue milestones down the road.
The companies expect the deal to close by the end of the year, subject to what onsemi described as customary closing conditions. Onsemi said it entered into an agreement to acquire Ferric as part of a broader push into power delivery for next-generation AI processors, according to the company's announcement. As Phoenix Business Journal reported, Ferric is based in New York, though a separate account from Digitimes also describes it as a New York-based maker of integrated voltage regulators for AI chips.
About 50 Ferric employees are expected to join onsemi once the deal closes, the company said, with most of that staff based in New York and Silicon Valley. Onsemi said it expects no meaningful near-term financial impact from the transaction, but anticipates it will eventually boost long-term revenue growth and gross-margin targets once the business scales.
What Ferric's Chips Actually Do
Ferric specializes in integrated voltage regulators, components that manage power delivery inside AI processors. The company says its technology, built from CMOS-integrated ferromagnetic thin-film inductors fabricated directly onto silicon, reduces board area by 50% to 70% compared with conventional discrete voltage-regulator setups, per its own description of the technology. That space savings matters as AI chips pack in more processing power and need tighter, more efficient ways to deliver electricity to the silicon.
The acquisition announcement also notes that Ferric holds a portfolio of more than 40 patents tied to that architecture. The broader industry trend, as described in onsemi's announcement, is to move voltage regulation progressively closer to the processor itself, a shift intended to reduce power losses, increase power density and let chips respond faster to changing power demands.
A Bigger Bet on AI Data Centers
The Ferric deal arrives alongside an updated financial target from onsemi: the company raised its 2030 AI data-center revenue goal by $500 million, now projecting more than $3 billion from that segment. The timing lines up with recent momentum in that part of onsemi's business. In its third-quarter 2026 results, the company reported that AI data-center revenue grew 39% sequentially and 175% year over year.
Onsemi framed the Ferric acquisition as a way to establish leadership in power delivery for next-generation AI processors, tying the deal directly to that data-center growth target. The company has not detailed exactly how the $175 million in milestone-based payments to Ferric will be measured, and the full list of closing conditions for the deal has not been disclosed.
