GlobalFoundries has signed a letter of intent with the US Department of Commerce for a $300 million CHIPS Act R&D award to advance silicon photonics, near-packaged optics (NPO), and co-packaged optics (CPO) for AI infrastructure. The award will fund development of next-generation optical materials, wafer technologies, and advanced packaging including 3D hybrid bonding. As part of the agreement, the Commerce Department will receive approximately 1% equity stake in GF. GF CEO Tim Breen emphasized that 'silicon photonics is essential to AI infrastructure' and that the shift from copper to optical interconnects for data center bandwidth is now happening at scale, not years away.
GlobalFoundries' Q2 2026 results showed 62% year-over-year revenue growth in communications infrastructure and AI data centers, with the company now expecting full-year growth of 50-60% in that segment — up from previous guidance of high 30s. Silicon photonics revenue is projected to more than double in 2026. The company has qualified seven active customer engagements and one tape-out in Q2, with another tape-out expected in Q3. GF's silicon germanium capacity is already oversubscribed through 2027, signaling acute demand for optical-grade semiconductors in AI cluster interconnects.
Photonics solves the next AI infrastructure bottleneck: as GPU clusters grow larger, copper interconnects hit bandwidth walls and power constraints. Optical signals deliver 400 Gbps with 5x better energy efficiency than current-gen alternatives. GF's SCALE platform aims to bring near-packaged and co-packaged optics to high-volume US manufacturing. For architects scaling AI infrastructure, this shifts the constraint from compute-to-compute bandwidth to cost and availability of optical interconnect modules — making domestic manufacturing capacity a competitive differentiator and supply-chain resilience matter.