onsemi to Acquire Synaptics in $7 Billion Deal to Expand Physical AI Push

Semiconductor company onsemi announced on June 25 that it has entered into a definitive agreement to acquire Synaptics in an all-stock transaction valued at approximately $7 billion, expanding its portfolio from power and sensing technologies into intelligent systems for Physical AI.

The transaction gives Synaptics shareholders 1.350 shares of onsemi common stock for each Synaptics share, representing a 19% premium over the companies' 10-day volume-weighted average closing prices. The deal has been unanimously approved by the boards of both companies and is expected to close in mid-2027, subject to regulatory approvals and Synaptics shareholder approval.

The acquisition is intended to strengthen onsemi's position across what it describes as the four pillars of Physical AI: Power, Sense, Connected Compute, and Control. The company said combining its semiconductor portfolio with Synaptics' Edge AI compute, human-machine interface, and wireless connectivity technologies would expand its total addressable market by $30 billion to an estimated $243 billion by 2030.

Physical AI Strategy Extends Beyond AI Data Centers

The company said the acquisition extends its reach beyond AI infrastructure into edge AI applications such as autonomous vehicles, robotics, industrial automation, and augmented and virtual reality. The move comes as investment across AI infrastructure continues to broaden beyond hyperscale computing toward intelligent edge systems where AI models run closer to devices and machines.

"As artificial intelligence moves beyond the cloud and into the physical world, including automotive and industrial, the next phase of innovation will depend on systems that can sense, decide, act and adapt in real time," Hassane El-Khoury, President and CEO of onsemi, said. "This shift towards Physical AI will require Power, Sense, Connected Compute and Control to work together seamlessly."

He added that Synaptics would bring connected compute capabilities while expanding onsemi's software ecosystem and helping the company address AI opportunities beyond the data center.

Synaptics Brings Edge AI Compute and Connectivity

The acquisition adds Synaptics' Astra platform, which combines AI processors and neural processing units with wireless connectivity technologies including Wi-Fi, Bluetooth, and GPS, supported by an open-source software stack for Edge AI deployments.

Rahul Patel, President and CEO of Synaptics, said the combination would enable integrated solutions spanning compute, connectivity, human-machine interfaces, power, and sensing.

"Together with onsemi, we will combine Synaptics' strengths in AI-native compute, connectivity, and human-machine interface with onsemi's leadership in intelligent power and sensing to offer customers integrated solutions and development platforms across every layer of the Edge AI stack," Patel said.

onsemi expects the transaction to be accretive to non-GAAP earnings per share within 18 months of closing and projects approximately $200 million in annual synergies. Under the agreement, Synaptics shareholders will own approximately 12% of the combined company on a fully diluted basis, and one Synaptics board member is expected to join onsemi's Board of Directors after the transaction closes.

The deal reflects continued consolidation across the AI semiconductor industry as companies expand beyond individual chip categories into integrated hardware and software platforms for edge AI workloads. Similar consolidation has also emerged in enterprise AI software through acquisitions aimed at expanding AI platform capabilities.