Product1 publisher2 min readPublished
Morphotonics banks 40 million euros to scale production and enter data-center optics market
The Dutch company stamps out waveguides for smart glasses and now wants to supply data center optics, a market where it has not installed a machine. Its backers include 3M Ventures and the European Investment Bank.
The Product Desk · Product desk
What happened
- Morphotonics said Tuesday it raised 40 million euros to scale up production and to enter a new market, optical components for data centers, in an extension of a round that began in 2024.
- The money came from 3M Ventures, Innovation Industries, BOM and Invest-NL, with the European Innovation Council Fund, Dutch family office Ernij Next and the European Investment Bank also participating.
- Its nanoimprint process stamps the waveguides used in smart glasses including the Meta Ray-Ban Display, Even Reality and Magic Leap, thin glass or plastic that bends light into an image in front of the eye.
- Headcount has more than doubled to 60 from roughly 30 in September 2024, when Hugo Da Silva became chief executive, and the company expects it to settle around 70 to 75.
Compiled by The Product DeskSomething wrong?How this is made
Why it matters
- constraint Morphotonics hands over the process and supplies the chemicals with the machine, so a customer that later wants a second source has to requalify the production line, not just issue another purchase order.
- decision A data center customer that wants this tooling is deciding to host a first-of-kind installation, and the cost of debugging it lands on that customer's own line.
- exposure European public lenders now sit behind a supplier whose manufacturing is concentrated in China, Taiwan and South Korea. Any disruption to the glasses supply chain would be felt there first.
- capability Because the process is licensed alongside the hardware, each additional installation adds recurring revenue, and the company said its services income should rise as deployments do.
A display maker that signs for one of these machines is also signing for Morphotonics' chemicals and its training. Hugo Da Silva, who joined as chief executive in September 2024, described the arrangement: "Typically, display manufacturers would acquire our equipment as part of the supply chain, and we integrate it into the entire manufacturing process. We teach them the process, we provide the chemicals, and they can manufacture that," he said [12]. The company sells the hardware and licenses the process, and roughly 90% of revenue comes from hardware sales [13][9].
Da Silva said the machine now being built will produce more than 6 million waveguides a year [6]. IDC projected in June that shipments of smart glasses with displays would reach 12.2 million by 2030 [7]. Two machines of that capacity cover the whole projected 2030 volume [8]. The true tool count depends on how many waveguides go into one device.
The data center half of the pitch is thinner than the display half. Co-packaged optics uses photonic integrated circuits, chips that run on light instead of electricity, to move data between servers and network equipment [17]. Morphotonics has not shipped a machine for it and did not give a date for a first deployment in that market; it said customers have validated the technology [18].
Display growth is ordinary capital-equipment growth. China said this week that domestic smart glasses sales doubled in the first eight months of the year [21]. Morphotonics has 10 to 15 systems deployed globally and expects 50 within two to three years [9][10], an increase of between 3.3 and 5 times depending on where the count starts today [11]. It said it has benefited from ASML's supply chain and uses many of the same vendors [19].
For anyone evaluating a nanoimprint tool, two things separate the machine you can buy from the machine being pitched: whether the vendor has installed a unit in an application like yours or has only validated one, and who holds the process after the crate is open, your engineers or the vendor's trainers and the vendor's resin. On glasses waveguides, Morphotonics has a double-digit installed base and 12 years of development behind the process [20]. On co-packaged optics, it has customer validation [18].
What to watch
- Whether the 6 million waveguide machine starts shipping early next year, and which customer takes the first unit.
- A first co-packaged optics order. That would move the data center claim from validation to an installed base.
- Whether deployments climb toward 50 and whether the services share of revenue climbs with them.