Spectra7 Sets Sights on 56Gbps PAM4 Server Connectivity with Three New Reference Designs

Nvidia, Broadcom and Intel Set to Rollout New Higher Speed Network Interface Cards that Will Drive Need for Spectra7 Enabled Data Center Interconnects

SAN JOSE, Calif.–(BUSINESS WIRE)–(TSX-V:SEV) Spectra7 Microsystems Inc. (“Spectra7” or the “Company”), a leading provider of high-performance analog semiconductor products for broadband connectivity markets, today announced three new reference designs targeted at new server connectivity needs implementing 56Gbps PAM4 signaling on Ethernet Network Interface Cards (NICs). The leading suppliers of these cards, Nvidia, Broadcom and Intel, are all gearing up to release new products using this higher speed signaling.

The data center Ethernet NIC market revenue is set to grow 28 percent in 2020 with growth accelerating through 2024, driven by server shipments and the adoption of higher speed offload and programmable NICs. This market is poised to hit $4.5 billion by 2024.¹ With virtualization, artificial intelligence (AI) and machine learning driving up server workloads, the network connection is becoming a bandwidth bottleneck. These NICs are used in servers by Hyperscalers such as Amazon, Google, Microsoft, Tencent, and Alibaba.

As servers adopt higher bandwidth ports that utilize 56Gbps PAM4 signaling, passive cables cannot serve all lengths needed. Instead of deploying optical interconnects that are much higher power and more costly, operators are looking to Active Copper Cables (ACCs) to serve this growing need. One example is Tencent who demonstrated a Spectra7 enabled ACC for server connectivity in September at China’s Open Data Center Committee (ODCC) conference. The 200Gbps demonstration showed a Spectra7 enabled ACC “splitter cable” connecting from a 200Gbps top-of-rack (ToR) switch port to 2 separate servers with 100Gbps NIC ports. The signaling in the cable was 56Gbps PAM4. This “splitter cable” architecture is being widely planned both in the US and in China for next generation deployments.

Spectra7 is announcing immediate availability of three reference designs to support this critical need. All designs utilize Spectra7’s Dual Channel 56Gbps PAM4 technology.

GCS-QSFP Reference Design

Server Connectivity Splitter Cable with 200Gbps QSFP56-CR4 form factor module at switch end and 2 QSFP56-CR2 form factor modules at server ends. A total of 4 GC2502 ICs are used in this reference design.

GCS-DSFP Reference Design

Server Connectivity Splitter Cable with 200Gbps QSFP56-CR4 form factor module at switch end and 2 DSFP-CR2 form factor modules at server ends. A total of 4 GC2502 ICs are used in this reference design.

GCS-SFP-DD Reference Design

Server Connectivity Splitter Cable with 200Gbps QSFP56-CR4 form factor module at switch end and 2 SFP-DD-CR2 form factor modules at server ends. A total of 4 GC2502 ICs are used in this reference design.

“We are thrilled that Hyperscalers are expanding their use of Spectra7 technology for use in 56Gbps server connectivity,” said Spectra7 CEO Raouf Halim. “This represents a significant increase in the market opportunity for our GC2502 data center solution. These new reference designs will enable our cable partners to quickly respond to these this new server connectivity requirements.”

GaugeChanger™ is an innovative and disruptive technology that allows copper to extend much longer lengths without the cost and power penalty of optics. It works equally well at 25Gbps NRZ and 50Gbps PAM4 enabling new connector standards of 100, 200 and 400Gbps.

ABOUT SPECTRA7 MICROSYSTEMS INC.

Spectra7 Microsystems Inc. is a high-performance analog semiconductor company delivering unprecedented bandwidth, speed and resolution to enable disruptive industrial design for leading electronics manufacturers in virtual reality, augmented reality, mixed reality, data centers and other connectivity markets. Spectra7 is based in San Jose, California with a design center in Cork, Ireland and technical support location in Dongguan, China. For more information, please visit www.spectra7.com.

Neither the TSX Venture Exchange nor its regulation services provided (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

CAUTIONARY NOTES

Certain statements contained in this press release constitute “forward-looking statements”. All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the Company’s future financial position and results of operations, outlook, strategy, proposed acquisitions, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words “believe”, “expect”, “aim”, “intend”, “plan”, “continue”, “will”, “may”, “would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company’s expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company’s Annual Information Form and annual MD&A for the year ended December 31, 2019. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law.

¹Omdia’s Ethernet Network Adapter Equipment Market Tracker.

Contacts

Spectra7 Microsystems Inc.

James Bergeron

Investor Relations

289-512-0541

ir@spectra7.com

Spectra7 Microsystems Inc.

Dave Mier

Chief Financial Officer

925-858-7011

pr@spectra7.com