The Commerce Department’s CHIPS Program Office has amended one of its largest foundry awards, reallocating as much as $955M inside the existing package rather than adding to it. The money now flows toward the technologies that data centers need, and away from the broader capacity build the original deal contemplated.
GlobalFoundries has agreed in return to lift its own capital commitment at Malta in New York and Burlington in Vermont to $5B. The envelope is not getting bigger: Commerce was explicit that the total award stays where it was.
The retargeted money goes to three areas. One is silicon photonics, the optical interconnect that is replacing copper between racks. Another is silicon-germanium, the material behind high-speed analog and RF parts. The third is the piece that matters most for AI accelerators. The two sites would host the first US-based source of silicon interposers, the pieces of silicon that sit under and beside chiplets in an advanced package.
That line lands in a gap the American supply chain has struggled with. Interposers have been dominated by Taiwanese makers tied to TSMC’s packaging work, and the government has been searching for domestic alternatives. Notably, the amendment arrives a day after GlobalFoundries signed a deal to handle interposer work for TSMC.
Bill Frauenhofer, who oversees semiconductor investment at Commerce, framed the change as onshoring components that are becoming scarce. The agency did not disclose a schedule for the interposer line or what share of the money goes to each of the three technologies.
