Lightwave Logic (LWLG) said late Wednesday it has signed a development agreement with Tower Semiconductor (TSEM) to develop high-speed optical modulators.

Lightwave shares surged 29% while Tower Semi jumped 7% in overngiht trading.

The companies will integrate Lightwave's modulator reference designs targeting bandwidths of 110 gigahertz and more into Tower's PH18 silicon photonics process design kit, according to a statement.

As part of the collaboration, Tower and Lightwave plan to let customers participate in engineering tapeouts during 2026, allowing early validation of modulator-based designs on the PH18 platform, the company said.