Nexthop AI, a Santa Clara company that makes networking equipment for AI data centres, announced on 10 March 2026 that it had closed an oversubscribed $500m Series B round valuing it at $4.2bn. Lightspeed Venture Partners led the round.
Andreessen Horowitz joined as a major investor, and Altimeter and Nexthop's existing investors also took part, according to Pulse 2.0 and SiliconANGLE. The company said the money will support research and development and broader infrastructure investment to speed up its networking platform.
The funding was announced together with a new hardware portfolio.
“AI clusters are pushing data center networks to their limits, and networking is now central to overall system performance.”Raghu Raghuram, General Partner, Andreessen Horowitz
What Nexthop AI does
Pulse 2.0 reported that Nexthop develops both off-the-shelf and customised switching systems built on open-source network operating systems such as SONiC and FBOSS. They are aimed at hyperscalers and newer "NeoCloud" providers that need to run large AI clusters. Chief executive and founder Anshul Sadana said the company has built highly customised joint-development-manufacturing solutions for the largest operators and turnkey platforms for NeoClouds.
The company is headquartered in Santa Clara and has other locations in Seattle, Vancouver, Dublin and Bengaluru, according to Pulse 2.0.
The new switches
SiliconANGLE reported that the launch includes three switches, the NH-4010, NH-4220 and NH-5010, all based on Broadcom networking chips. The NH-4010 handles 51.2 terabits of traffic per second and the NH-4220 twice that. Nexthop says the former is up to 20% more power-efficient than comparable rival products; that is a company claim.
Converge Digest said the NH-5010 supports a disaggregated spine architecture developed with a hyperscale partner. The design splits traditional chassis-based systems into functional tiers, one facing the data centre fabric and one facing the data centre interconnect. Nexthop says this reduces cost and power consumption by about 30% compared with older chassis designs, and that the platforms are already shipping to leading hyperscalers. Customers manage the hardware with Nexthop NOS, an operating system based on SONiC, which SiliconANGLE said adds security optimisations and a faster patch-update service.
Investor view
Guru Chahal, a partner at Lightspeed, said in the announcement that the rapid growth of AI is forcing a rethink of data centre network architecture, creating one of the largest infrastructure opportunities in a generation, with the potential to build a $100bn-plus company. He said Lightspeed had invested in Nexthop from day one.
Raghu Raghuram, a general partner at Andreessen Horowitz, said networking is now central to overall system performance and that Nexthop is purpose-built for that shift.
What comes next
Nexthop said it plans to keep expanding its product portfolio to meet demand from the global build-out of AI infrastructure. The sources reviewed did not disclose the year the company was founded, its headcount, revenue or the size of earlier rounds.
Company website: nexthop.ai