GlobalFoundries has signed a letter of intent with the U.S. Department of Commerce for an expected $300 million CHIPS research and development award supporting next-generation silicon photonics technology for artificial intelligence and high-performance computing infrastructure.
The proposed award would support GlobalFoundries’ development of advanced optical materials, wafer technologies and semiconductor packaging. The agreement remains a letter of intent rather than a finalized funding award.
In a separate agreement, the Department of Commerce will receive an equity interest representing approximately 1% of GlobalFoundries’ current ownership. The arrangement is intended to give the American public exposure to the company’s potential future growth.
Silicon photonics uses light instead of conventional electrical signals to move information within and between computing systems.
The technology is becoming increasingly important as AI models require thousands of processors to exchange large amounts of data rapidly. Even when individual processors become more powerful, the broader system can remain constrained if information cannot move efficiently among chips, memory and networking equipment.
Traditional copper connections face increasing limitations involving bandwidth, distance and power consumption as computing clusters grow. Optical connections can move larger amounts of data with lower energy requirements, potentially improving the performance and efficiency of AI data centers.
GlobalFoundries plans to use the expected funding to advance near-packaged optics and co-packaged optics.
Near-packaged optics places optical components closer to the processing or networking chip than conventional pluggable optical modules. Co-packaged optics integrates optical connectivity more directly with the computing or networking package.
Both approaches can reduce the distance electrical signals must travel before being converted into light. This can increase bandwidth while lowering power consumption and signal loss.
The research will build on GlobalFoundries’ recently introduced SCALE platform, which stands for Silicon Photonics Co-Packaged Advanced Light Engine.
The company is targeting modular designs capable of 400 gigabits-per-second performance and a fivefold increase in energy efficiency compared with current-generation implementations.
The program will also incorporate GlobalFoundries’ advanced packaging capabilities, including 3D hybrid bonding.
Hybrid bonding connects semiconductor components through closely aligned electrical contacts without relying on larger conventional solder bumps. This can increase connection density and shorten the distance data must travel between chips.
The technology is relevant to AI infrastructure because systems increasingly combine several specialized components within one package, including processors, memory, networking devices and optical engines.
GlobalFoundries expects to use its existing operations in Malta, New York, and Burlington, Vermont, to support the research and establish a domestic path toward high-volume silicon photonics manufacturing.
The company already manufactures silicon photonics devices used in pluggable optical interconnects. The additional research is intended to help customers move toward more tightly integrated optical systems as AI and data center requirements increase.
GlobalFoundries CEO Tim Breen said the shift from copper to optical connectivity has moved from a long-term industry expectation into an immediate infrastructure requirement.
The company has spent more than a decade developing silicon photonics technology, manufacturing capabilities and industry relationships. It believes that foundation positions it to scale optical products in the United States.
The proposed investment received support from companies across the semiconductor, cloud computing, networking and optical technology sectors.
The industry support demonstrates that silicon photonics affects more than optical component suppliers. The technology can influence the performance of processors, networking switches, cloud systems and entire data center architectures.
As model sizes and computing clusters increase, network traffic can consume a growing portion of system power. Optical connectivity may allow data centers to add computing capacity without increasing networking energy consumption at the same rate.
The CHIPS R&D award is also intended to strengthen domestic semiconductor research and production.
Unlike grants focused primarily on expanding conventional chip manufacturing capacity, this proposed award would support the development of technologies connecting processors and other components within advanced computing systems.
GlobalFoundries manufactures semiconductors for automotive, aerospace and defense, data center, mobile, Internet of Things and other markets. The company maintains manufacturing operations across the United States, Europe and Asia. The expected award remains subject to the completion of definitive agreements and other requirements associated with the CHIPS R&D program.
KEY QUOTES:
“With today’s compute supply chain investments, the Trump Administration is accelerating America’s innovation engine. These strategic investments will enhance our country’s domestic capabilities, create high-paying jobs and keep America at the forefront of the semiconductor industry.”
Howard Lutnick, U.S. Secretary of Commerce
“The CHIPS R&D incentives will support a breakthrough in compute and communication networks moving past traditional copper bottlenecking to power next-generation AI. Accelerating R&D for domestic photonics capabilities and advanced packaging provides American industry the extreme bandwidth and energy efficiency to scale complex AI workloads securely and rapidly.”
Bill Frauenhofer, Executive Director for Semiconductor Innovation and Investment at the U.S. Department of Commerce
“Silicon photonics is essential to AI infrastructure. For a decade, the industry talked about the shift from copper to optical as something that was coming. Today it is here, moving data at higher bandwidth and improved power efficiency as workloads grow more complex.”
“GlobalFoundries has spent more than a decade building the technology, footprint and ecosystem to lead this transition, and we have the proven manufacturing foundation to scale it in the United States, accelerating technology leadership for generations to come. We are proud to deepen our partnership with the U.S. Government, and the CHIPS R&D Office in particular, to accelerate our programs.”
Tim Breen, Chief Executive Officer of GlobalFoundries
“As we accelerate development of next-generation optical materials and co-packaged optics, GF is building on our already qualified portfolio of photonic devices, proven 3D hybrid bonding and advanced packaging expertise, combined with our manufacturing scale to bring near-packaged and co-packaged optics to high volume, putting our customers on a direct, U.S.-based path to scaling optical connectivity for tomorrow’s AI systems.”
Gregg Bartlett, Chief Technology Officer of GlobalFoundries
“As AI systems scale, moving data efficiently is as critical as increasing compute performance. Silicon photonics and advanced packaging will be key to delivering the bandwidth, energy efficiency, and system-level connectivity required for the next generation of AI cluster infrastructure.”
“We welcome GlobalFoundries’ continued investment in U.S.-based innovation and manufacturing, and the broader public-private collaboration needed to advance these foundational technologies.”
Mark Papermaster, Chief Technology Officer and Executive Vice President of AMD
“As AI workloads continue to grow in size and complexity, scaling the infrastructure that connects increasingly powerful compute clusters is becoming one of the industry’s defining challenges.”
“Advances in optical interconnects, silicon photonics and advanced packaging will be critical to enabling the next generation of AI architectures. GlobalFoundries’ announcement today helps strengthen the innovation ecosystem needed to accelerate development of these foundational technologies.”
Near Margalit, Vice President and General Manager of the Optical Systems Division at Broadcom
“As AI infrastructure scales, moving data efficiently is becoming as important as compute itself. Advances in silicon photonics and optical interconnects will be critical to enabling the bandwidth, performance and energy efficiency future AI systems require.”
“GlobalFoundries’ investment in next-generation silicon photonics technologies helps strengthen the foundation for future AI networking and optical infrastructure.”
Jeetu Patel, President and Chief Product Officer of Cisco
“The rapid growth of AI is driving unprecedented bandwidth demands, making optical connectivity essential to next-generation data centers.”
“Meeting these demands will require innovation across the ecosystem from advanced materials and optical components to silicon photonics and packaging. Investments such as GlobalFoundries’ announcement today help strengthen the U.S. innovation and manufacturing base needed to scale future AI infrastructure.”
Wendell P. Weeks, Chairman, Chief Executive Officer and President of Corning
“AI is driving unprecedented demand for optical connectivity that can move more data while consuming less power.”
“Meeting that challenge will require continued innovation across the silicon photonics ecosystem and a strong, resilient U.S.-based supply chain capable of scaling advanced optical technologies. GlobalFoundries’ investments in silicon photonics and advanced packaging, combined with support from the U.S. government, are helping accelerate an open path to next-generation optical interconnect that will be essential for the future of AI and high-performance computing.”
Michael Hurlston, Chief Executive Officer of Lumentum
“The bottleneck in AI infrastructure is shifting from compute to connectivity, the ability to move data between and within systems without letting bandwidth or power constraints limit performance.”
“As a leader in silicon photonics and optical connectivity, Marvell welcomes continued investment in U.S.-based R&D to accelerate the transition to near-packaged and co-packaged optics, key to scaling the next generation of AI infrastructure.”
Chris Koopmans, President and Chief Operating Officer of Marvell
“Silicon photonics technologies will play a critical role in future generations of Meta’s AI infrastructure.”
“We believe that a multi-supplier, geographically diverse ecosystem produces the best technical innovations and the most scalable high-volume supply chains, and investing in U.S. manufacturing capacity is a crucial component in achieving this goal.”
Yee Jiun Song, Vice President of Engineering at Meta
“The next generation of AI infrastructure will require significant advances in networking, optical interconnects and data movement. Silicon photonics is an important enabling technology for meeting those demands.”
“Microsoft welcomes industrywide investments that accelerate innovation and strengthen the ecosystem developing the technologies that will power the future of AI.”
Rani Borkar, President of Azure Hardware Systems and Infrastructure at Microsoft
“Rebuilding our supply chains is critical to the new industrial revolution. Scaling U.S. manufacturing requires advances across chips, networking, optics, software, and manufacturing.”
“Silicon photonics is essential to that future, and GlobalFoundries brings the manufacturing expertise to help make it real in the United States.”
Jensen Huang, Founder and Chief Executive Officer of NVIDIA
“As AI expands across cloud, enterprise and edge environments, enabling greater performance and efficiency will require innovation throughout the technology stack.”
“Silicon photonics has the potential to play an important role in supporting next-generation AI platforms by helping address growing bandwidth and connectivity demands. We welcome efforts that advance innovation in this important technology area.”
Kevin O’Buckley, Executive Vice President of Global Operations and Supply Chain at Qualcomm
