For most of the AI boom, investors chased whoever built the fastest processor. Navitas Semiconductor (NVTS) is betting the next fight is over something plainer: getting power into that processor without wasting it.
The power chipmaker closed its acquisition of Claros on Tuesday, Oct. 6, 2026, according to a company filing. Claros makes integrated voltage regulators that handle the final power conversion right at an AI processor, sometimes directly beneath it.
Chief Executive Chris Allexandre was blunt in the release, saying power is now the bottleneck for AI. Navitas calls it the “power wall” and argues that faster, more efficient power delivery is the main path to more AI computing.
Investors shrugged. Navitas shares ended the session lower.
The deal was confirmed in August, and Navitas has pegged Claros as a growth accelerator for 2028 and 2029. Markets rarely pay up early for a payoff that far out.
Read More: AI racks are outgrowing old power: 2 chipmakers have a strategy
Claros puts Navitas at the processor’s front door
Before Claros, Navitas’ AI pitch rested on gallium nitride and silicon carbide chips that convert power further upstream.
An update on its chips for Nvidia’s (NVDA) 800-volt design sent the stock soaring last October, Barron’s reported. Claros covers the final stretch into the processor.
The company expects the deal to more than double its serviceable addressable market to over $8 billion by 2030, according to the filing. That is the market Navitas thinks it can chase, not the revenue it expects to book.
Trailing revenue is about $37 million, according to Stock Analysis, so I treat the $8 billion figure as a map rather than a forecast.
Here is what I think most coverage misses. If power is the real constraint, every watt lost as heat near the processor is a watt an operator paid for and never used. Efficiency at the last inch then works like new capacity, which makes this corner of the chip market more strategic than it looks.
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Shareholders are already funding the power bet
The deal was valued at up to about $233 million, with roughly $216 million due at closing in cash and stock. The rest comes in shares only if Claros hits milestones over two years.
I like that structure because the full price depends on Claros delivering. The catch is that success itself creates more shares.
Navitas’ share count rose about 20% over the past year, according to Stock Analysis. Reuters reported earlier this year that a $125 million stock sale could help fund potential acquisitions.
The upside is about $557 million in cash and almost no debt, according to Stock Analysis. That buys time to prove Claros works, even if profitability remains a downstream milestone.
With dilution rising and immediate profits still absent, the market is taking a “show-me” approach.
Wall Street rates Navitas stock a Hold for good reason
Navitas is a power chip designer worth about $3.1 billion, according to Stock Analysis. For investors, it is one of the purest bets on AI power delivery, which cuts both ways.
Its 52-week range runs from $6.85 to $34.17. That June 2026 peak also marks its all-time high, a long climb from the $1.52 all-time low set in April 2025, as The Motley Fool reported. Barron’s tied the recent bounce to a U.S. Army award after a steep slide from those highs.
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Eight analysts rate Navitas a Hold on average, with a $14.08 price target, according to Stock Analysis. Only two of them rate it a Buy or Strong Buy, and targets range from $8 to $21.
Morgan Stanley reiterated its bearish rating on Tuesday, Sept. 29, 2026, with a $13 target. That spread shows how divided the Street is.
At more than 80 times trailing sales, Navitas remains a watchlist stock rather than an immediate buy.
Two dates could change my view. According to the filing, Navitas will walk through Claros’ technology in a webinar on Tuesday, Oct. 20, 2026. Its next earnings report is expected on Monday, Nov. 2, 2026, according to Stock Analysis.
Named hyperscaler customers for Claros would make the valuation look less like a leap of faith.
The AI power race is moving onto the chip itself
In my view, the bottleneck in AI hardware keeps shifting, from processors to memory and now to power. Pricing power tends to follow the constraint, and that is the real prize in this deal.
That is why a deal this small matters beyond Navitas. Power chips have long been a supporting act in the AI story. If the power wall is as real as Navitas says, whoever owns the last millimeters before the processor could gain outsized say over AI hardware.
The Oct. 20 webinar is the first public test of whether Navitas can claim that ground.
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