Aug-10-2026 –The U.S. Department of Commerce has signed letters of intent to provide up to $874 million in incentives to seven semiconductor companies developing technologies aimed at artificial intelligence, advanced computing, semiconductor packaging, materials and supply-chain security. The proposed funding forms part of the U.S. government’s broader semiconductor strategy under the CHIPS and Science Act, which is intended to strengthen domestic semiconductor technology development and reduce reliance on overseas supply chains.
The largest proposed award would go to GlobalFoundries, which could receive up to $300 million for the development of advanced co-packaged optics technology.
GlobalFoundries is expected to receive up to $300 million to support the development of co-packaged optics, a technology increasingly viewed as critical for future AI computing infrastructure. Co-packaged optics integrates optical communication technology much closer to high-performance processors and switches. Instead of relying exclusively on traditional electrical connections, optical links can provide significantly higher bandwidth while reducing the energy required to move large amounts of data.
This is becoming particularly important in AI data centers, where accelerators, networking devices and memory systems must exchange enormous volumes of data. As AI processors become faster, the communication infrastructure surrounding those processors is increasingly becoming a performance bottleneck. Co-packaged optics could therefore become an important enabling technology for next-generation AI clusters.
Another major proposed award is approximately $245 million for Kepler, which is developing new memory technology targeted at AI computing applications. AI infrastructure requires both enormous memory capacity and extremely high memory bandwidth.
The rapid expansion of AI accelerators has already created strong demand for technologies such as High Bandwidth Memory, while semiconductor companies continue to explore alternative architectures capable of reducing power consumption and improving data movement between processors and memory. Kepler’s proposed funding indicates that the U.S. government sees memory architecture as another strategically important part of the domestic AI semiconductor ecosystem.
Multibeam Corporation could receive up to $140 million for advanced semiconductor packaging equipment. Advanced packaging has become one of the semiconductor industry’s most important technology areas. Instead of manufacturing every function within a single large monolithic die, semiconductor companies are increasingly combining multiple dies or chiplets inside advanced packages.
This approach is particularly important for:
Packaging equipment capable of supporting these increasingly complex architectures is therefore becoming strategically important to the semiconductor supply chain.
Four other companies — Extropic, Thintronics, OBSIDIA Semiconductors and Aeluma — are expected to receive proposed awards ranging from approximately $30 million to $75 million. Their projects cover several emerging semiconductor technologies, including lower-power computing architectures, advanced semiconductor materials and technologies designed to detect counterfeit electronic components. The diversity of the projects highlights the expanding definition of semiconductor infrastructure. Government semiconductor investment is no longer focused exclusively on wafer fabs.
The semiconductor ecosystem increasingly depends on technologies covering:
One particularly notable element of the proposed agreements is that the U.S. Department of Commerce intends to take minority equity positions in each of the seven companies as part of the funding arrangements. This differs from the more traditional grant structure associated with many government semiconductor incentives. However, the agreements remain subject to further review before any final awards are issued.
The announced $874 million therefore represents the maximum value of the proposed incentives under the letters of intent, rather than completed funding transactions.
| Company | Proposed Funding | Main Technology Area |
|---|---|---|
| GlobalFoundries | Up to $300M | Co-packaged optics |
| Kepler | Up to $245M | AI memory technology |
| Multibeam Corporation | Up to $140M | Advanced semiconductor packaging equipment |
| Extropic | $30M–$75M range | Low-power / AI computing |
| Thintronics | $30M–$75M range | Advanced semiconductor technology/materials |
| OBSIDIA Semiconductors | $30M–$75M range | Semiconductor technology |
| Aeluma | $30M–$75M range | Advanced semiconductor materials / technology |
The awards also demonstrate how rapidly the AI semiconductor ecosystem is expanding beyond advanced logic manufacturing. Modern AI systems depend on much more than advanced GPUs.
Performance increasingly depends on an entire technology stack including memory, photonics, packaging, networking and specialized semiconductor materials. The investment in GlobalFoundries’ co-packaged optics work is particularly significant because interconnect bandwidth and power consumption are becoming increasingly important constraints in large AI computing systems. Similarly, investments in memory and advanced packaging reflect the growing importance of moving data efficiently between processors, memory and accelerators. For semiconductor suppliers, this trend could create opportunities throughout the supply chain — from wafer manufacturing and specialty processes to photonics, packaging, materials, equipment and semiconductor IP.
The proposed $874 million investment therefore represents not only another CHIPS Act funding initiative, but also an indication of where the U.S. government believes the next semiconductor technology bottlenecks are likely to emerge.
Source: Reuters, July 30, 2026. The announced amounts are proposed incentives under letters of intent and remain subject to final review and award.