GlobalFoundries (semiconductor manufacturer) has signed a letter of intent with the U.S. Department of Commerce under which the agency's CHIPS Research and Development Office is expected to award the semiconductor manufacturer USD 300 million to advance next-generation silicon photonics technology, the company announced on July 29, 2026.

The Malta, New York-based chipmaker said the funding will support research and development of optical materials, wafer technologies and advanced packaging intended to accelerate the transition from copper-based data transmission to optical interconnects in AI and high-performance computing infrastructure.

What the Award Covers

The USD 300 million award is directed at accelerating GlobalFoundries' development of next-generation silicon photonics wafer technologies, novel optical materials, and advanced packaging capabilities, including what the company describes as proven 3D hybrid bonding.

The work is intended to enable the rollout of near-packaged optics and co-packaged optics, both of which represent emerging architectures for moving data inside and between compute systems at higher bandwidth and lower power consumption.

The funding builds on GlobalFoundries' recently introduced SCALE platform, which stands for Silicon Photonics Co-Packaged Advanced Light Engine. The company says the platform targets 400 gigabits per second performance and a five-times increase in energy efficiency compared with current-generation implementations, along with what it characterizes as industry-leading modularity.

In a separate agreement connected to the announcement, the U.S. Department of Commerce will receive an equity stake in GlobalFoundries representing approximately one percent ownership as of the date of the announcement. The company described this arrangement as enabling the American public to share in its growth.

Technology Context

Silicon photonics transmits data using light rather than electrical signals, a characteristic GlobalFoundries says delivers greater performance, higher interconnect density and lower power consumption as AI and data center workloads increase in scale and complexity.

The company stated that for roughly a decade the industry anticipated a broad shift from copper to optical interconnects, and that this transition is now actively underway.

GlobalFoundries said it has spent more than a decade building its technology portfolio, manufacturing footprint and industry ecosystem in preparation for this shift.

The company's existing silicon photonics platform currently supports pluggable optical interconnects and is positioned, the company said, to support the industry's move toward near-packaged and co-packaged optics architectures.

The R&D work funded through the CHIPS award will leverage GlobalFoundries' existing facilities in Malta, New York, and Burlington, Vermont. The company said the program is intended to accelerate a U.S.-based path to high-volume silicon photonics manufacturing.

Executive Statements

Tim Breen, chief executive officer of GlobalFoundries, said the company has built the technology, footprint, and ecosystem to lead the transition from copper to optical.

"We have the proven manufacturing foundation to scale it, in the United States, accelerating technology leadership for generations to come," Breen said, adding that the company is proud to deepen its partnership with the U.S. government and the CHIPS R&D Office in particular.

Gregg Bartlett, GlobalFoundries' chief technology officer, said the company is building on an already qualified portfolio of photonic devices, proven 3D hybrid bonding, and advanced packaging expertise.

"We are 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," Bartlett said.

Secretary of Commerce Howard Lutnick framed the investment in terms of domestic industrial capacity. "These strategic investments will enhance our country's domestic capabilities, create high-paying jobs, and keep America at the forefront of the semiconductor industry," Lutnick said.

Bill Frauenhofer, Executive Director for Semiconductor Innovation and Investment at the Department of Commerce, said the CHIPS R&D incentives are designed to move computing and communication networks beyond what he described as traditional copper bottlenecking.

He added that accelerating domestic photonics capabilities and advanced packaging provides American industry with the bandwidth and energy efficiency required to scale complex AI workloads.

Industry Partners

GlobalFoundries said it is working with leading customers to ensure that emerging near-packaged optics and co-packaged optics architectures are supported by U.S.-based silicon photonics research and development. Several major technology companies offered statements in support of the announcement.

Mark Papermaster, chief technology officer and executive vice president at AMD, said that 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," Papermaster said, welcoming GlobalFoundries' continued investment in U.S.-based innovation and manufacturing.

Near Margalit, vice president and general manager of the Optical Systems Division at Broadcom, described scaling the infrastructure that connects increasingly powerful compute clusters as 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," Margalit said, adding that the GlobalFoundries announcement helps strengthen the innovation ecosystem needed to accelerate development of these technologies.

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