xLight: The Little-Known Chip Startup That Just Won Trump Administration’s Backing

In the global race for semiconductor dominance, giants like TSMC, Intel, and ASML typically command all the attention. But every now and then, a quiet new player emerges—one bold enough to challenge long-accepted limits and attempt something that sounds closer to science fiction than engineering.

This week, one such outsider suddenly stepped into the spotlight.

xLight, a barely-known startup working on next-generation chipmaking lasers, has secured up to $150 million in support from the Trump administration—marking the first Chips Act award of President Trump’s second term. The investment signals the government’s growing willingness to place big bets on early-stage innovators that could define America’s technological edge for decades.

And in the world of semiconductors, where progress depends on shrinking the impossible into the invisible, xLight believes it can rewrite the rules.

A High-Stakes Bet on a New Kind of Light

According to The Wall Street Journal, the Commerce Department has agreed—under a preliminary arrangement—to channel Chips and Science Act funding into xLight. In exchange, the government will receive an equity stake large enough to potentially become xLight’s largest shareholder.

The reason is simple:
xLight is trying to fix a choke point in the world’s chip supply chain that only one company has mastered.

Currently, ASML of the Netherlands stands alone as the exclusive supplier of EUV lithography machines—massive systems costing hundreds of millions of dollars and essential for creating the most advanced chips used in AI, defense, and next-gen electronics.

These machines rely on highly specialised, extremely powerful lasers to etch ultra-tiny patterns onto silicon wafers.

xLight wants to build a better one.

What Makes xLight Different?

At the heart of the startup’s ambition is a radical technology:
free-electron lasers driven by a particle accelerator.

This is not a compact tabletop laser.
xLight’s system—if realised—would be an industrial-scale installation almost the size of a football field, roughly 100 metres by 50 metres, sitting outside a semiconductor fab and supplying it with an incredibly precise beam.

These free-electron lasers could potentially:

• produce far shorter wavelengths than today’s EUV tools

• deliver greater precision

• improve chip yield rates

• and significantly reduce energy consumption

The company expects to produce its first test wafers by 2028, made possible by federal funding.

Why This Matters for the US

The US has spent years trying to rebuild its chipmaking base. Yet it still relies—especially at the cutting edge—on expensive equipment and supply chains dominated by foreign players.

That dependence is seen as a national security risk.

If xLight’s technology works, America wouldn’t just strengthen its semiconductor autonomy—it could leapfrog existing systems entirely.

ASML’s current lasers generate EUV light at 13.5 nanometres.
xLight wants to push that down to 2 nanometres.

In semiconductor engineering, that’s not an incremental improvement.
It’s a generational breakthrough.

A 2 nm wavelength could unlock chip features so small that it would effectively turbocharge Moore’s Law—the decades-old expectation that transistor counts double roughly every two years.

“We are here to wake up Moore’s Law,” said Executive Chairman Pat Gelsinger, as quoted by the Financial Times. “It’s been taking a nap.”

Gelsinger added that xLight’s system could lower energy consumption while improving wafer output by 30–40%—a massive gain for chip fabs that operate at enormous scale.

“If this company is successful, we will change semiconductors,” he said.
“We can improve the economics of today’s EUV and enable tomorrow’s EUV.”

The Pat Gelsinger Factor

The company’s leadership is another major reason xLight’s name is everywhere right now.

Its executive chairman is Pat Gelsinger—the former Intel CEO who was dismissed by the board after the chipmaker struggled with manufacturing delays and underwhelming financials.

For Gelsinger, this isn’t just another job.

“I wasn’t done yet,” he said. “This is deeply personal to me.”

His involvement is drawing attention, especially since his time at Intel was marked by bold promises, many of which were criticised as overly optimistic even as the company accepted billions in government support.

At xLight, he is betting on a cleaner slate—and a technology ambitious enough to match his drive.

The startup is helmed by CEO Nicholas Kelez, a former quantum technology researcher with experience in US government labs. Earlier this year, xLight raised $40 million from investors including Playground Global—where Gelsinger is a general partner.

The First Chips Act Award of Trump’s Second Term

The xLight deal is notable not just for its size but for its symbolism.

This is the first Chips Act award announced under President Trump’s second administration. Commerce Secretary Howard Lutnick described the partnership as one that “would back a technology that can fundamentally rewrite the limits of chipmaking.”

The agreement is still preliminary and may change, but it signals a strategic shift: the administration is now more open to direct investments in private, early-stage technology companies.

Critics call this a slide toward “state capitalism.”
The government argues it’s necessary to secure national security and technological independence.

Part of a Much Bigger Race

xLight’s emergence comes at a moment of intense movement within the US semiconductor landscape:

• In October, Peter Thiel-backed Substrate raised $100 million to build EUV-capable fabs in the US.

• The Commerce Department is pushing giants like TSMC and Samsung to expand their manufacturing presence in America.

• Federal agencies are accelerating efforts to strengthen domestic chip research, production, and supply chains.

According to Gelsinger, he first discussed xLight with Lutnick in February—before he officially joined the startup, and before Lutnick’s Senate confirmation.

That means the idea had been circulating inside Washington long before this week’s announcement.

A Small Player With a Potentially Huge Impact

Whether xLight succeeds is still a big question.
Building new laser technology, especially one of this scale, is notoriously complex. Integrating it into ASML’s systems—or building competing systems entirely—would require enormous technical achievements and deep industry coordination.

But the fact that the US government is willing to take an equity stake in such early-stage hardware shows how serious the stakes have become.

The chip wars are no longer just about fabs or funding—they’re about physics.

And xLight, armed with particle accelerators and free-electron lasers, wants to push the boundaries of what chipmaking light itself can do.

If it works, this quiet startup could end up reshaping the world’s semiconductor future. If it fails, it will still be remembered as one of the boldest attempts to break through the limits that have held for years.

Either way, the US government has made a clear statement: The next revolution in chips may come not from a giant, but from a daring newcomer determined to wake Moore’s Law up again.