The US government has handed SandboxAQ a $500 million grant to find new materials for making semiconductors. The money comes from the CHIPS Act, the 2022 law meant to revive American chip manufacturing and cut dependence on foreign suppliers.
A $500 million bet on chip materials
The award targets a bottleneck in the semiconductor industry: the materials that go into chips. Advanced processors rely on exotic compounds, many of which are controlled by a handful of companies, most based in Asia. SandboxAQ will use the funds to accelerate discovery of alternatives that can be produced domestically or sourced from allies.
The company itself doesn't make chips. It builds software that applies artificial intelligence and quantum techniques to simulate atomic-scale behavior. That kind of simulation can screen thousands of candidate materials in weeks instead of years, a process the government hopes will yield breakthroughs in substrates, dielectrics, and other layers that determine chip performance.
Why the semiconductor supply chain matters
Today's chip supply chain is fragile. Taiwan produces more than 60% of the world's advanced logic chips, and South Korea dominates memory. China has poured billions into its own semiconductor ecosystem, raising concerns in Washington about strategic dependencies.
The CHIPS Act set aside roughly $53 billion for domestic chip production, research, and workforce development. Most of that money has gone to building fabrication plants — Intel, TSMC, and Samsung are all expanding in Arizona and Texas. But the act also carved out funds for materials research, arguing that even if the US makes chips, it still imports many of the raw and processed materials needed for them.
The SandboxAQ grant is one of the largest single awards for materials discovery under the program. It signals that the government sees materials as a weak link in its push for self-reliance.
The push for US technological independence
Officials have framed the investment as part of a broader effort to rebuild technological sovereignty. The US leads in chip design but has lost most of its manufacturing edge. The CHIPS Act aims to change that by subsidizing everything from sand-to-silicon processes to advanced packaging.
Reducing reliance on China is a stated goal. China controls a significant share of the supply of rare-earth elements and certain specialty chemicals used in chip fabrication. The SandboxAQ project is expected to identify materials that can be sourced from North American mines or recycled from existing waste streams, lessening the need for imports from China.
The grant also comes with oversight. SandboxAQ will have to report progress milestones and share intellectual property related to the materials it discovers. Government agencies will retain rights to license the technology to other US manufacturers, ensuring the results don't end up locked behind corporate walls.
What happens next: SandboxAQ is expected to name its first materials targets within the next 12 months. The company will work with national labs and university research centers to validate candidates. If successful, the new materials could enter pilot production by the end of the decade.
