US to invest $150m in xLight for next-generation chip manufacturing

• xLight is collaborating with US national laboratories on a prototype designed to integrate with tools from ASML or prospective rivals.
• Officials say the investment is meant to catalyse domestic laser-source innovation that could eventually diversify suppliers in the EUV ecosystem and improve energy efficiency across fabs.

The US Department of Commerce said it intends to invest up to $150 million in xLight, a startup developing free-electron lasers aimed at next-generation chip manufacturing, marking the first incentive commitment from the CHIPS Research and Development Office under the Trump administration.

The department signed a non-binding preliminary letter of intent and did not disclose the size of the federal stake. The move follows the administration’s takeover of a $7.4 billion Biden-era semiconductor research institute, signaling a reshaped federal push to onshore and advance critical chipmaking technologies.

At the heart of advanced semiconductor production is extreme ultraviolet (EUV) lithography, used to etch circuitry onto silicon wafers. ASML of the Netherlands remains the sole producer of EUV systems, though startups such as Substrate are pursuing competitors. Within those machines, the laser source is among the most complex components to build and scale.

Reducing power consumption

xLight proposes a laser architecture derived from particle accelerator technology, which it says could dramatically reduce power consumption versus current light sources. The company is collaborating with US national laboratories on a prototype designed to integrate with tools from ASML or prospective rivals.

“For far too long, America ceded the frontier of advanced lithography to others. Under President Trump, those days are over,” Commerce Secretary Howard Lutnick said in a statement.

The company has added former Intel CEO Pat Gelsinger as executive chairman, a role he assumed in March, bolstering its leadership as it seeks to commercialise the technology. Officials said the investment is meant to catalyse domestic laser-source innovation that could eventually diversify suppliers in the EUV ecosystem and improve energy efficiency across fabs.