GlobalFoundries jumps on 300M US award for silicon photonics

GlobalFoundries (GFS) shares jumped nearly 15% in premarket trading Wednesday after the chipmaker signed a letter of intent with the U.S. Department of Commerce for a $300M award to speed the development of next-generation silicon photonics, a technology that uses light to transfer data more efficiently in AI and high-performance computing data centers.

Separately, the commerce department will receive an equity stake of about 1% in GlobalFoundries.

The funding will support the development of silicon photonics wafer technology, new optical materials, and advanced packaging technologies needed for next-generation optical interconnects in AI data centers.

“The CHIPS R&D incentives will support a breakthrough in compute and communication networks moving past traditional copper bottlenecking to power next-generation AI,” said Bill Frauenhofer, the Executive Director for Semiconductor Innovation and Investment at the Department of Commerce. “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.”