Catenaa, Saturday, April 11, 2026- Japan approved another $4 billion in subsidies for Rapidus, bringing the total to $16.3 billion, to accelerate its entry into the high-stakes global AI chipmaking arena.
The capital is intended to bankroll Rapidus’ work for IT firm Fujitsu, one of the initial clients that Tokyo hopes will get the signature endeavor off the ground.
The new money raises the fees and investments that the government is injecting into the startup to $16.3 billion by the end of the current fiscal year, to March 2027, according to a statement from the Ministry of Economy, Trade and Industry.
An external committee inspected Rapidus’ foundry in Hokkaido in northern Japan, and signed off on its technological progress, the ministry said Saturday.
Tokyo is offering financial support to Rapidus to help it secure customers, Minister Ryosei Akazawa told reporters at a Rapidus event in Hokkaido on Saturday.
The fledgling company aims to make cutting-edge 2-nanometer chips by 2027, a schedule Akazawa reaffirmed, and help Japan lower its reliance on industry leader Taiwan Semiconductor Manufacturing Policymakers see Rapidus’ success and technological independence in AI, robotics, and quantum computing as critical to the country’s security.
The Japanese state-backed venture, founded in 2022, now faces additional competition for chip expertise from an unlikely quarter: Elon Musk is entering the white-hot arena, partnering with Intel on the so-called Terafab project to make semiconductors for his companies, including Tesla, SpaceX, and xAI.
Despite its latest strides forward, Rapidus remains far behind TSMC, which began 2nm volume production last year and is the go-to chipmaker for Nvidia and Apple.
In addition to technological hurdles, Rapidus, like other manufacturers in resource-poor Japan, is being hit by rising costs of energy and materials amid the conflict in the Middle East.
Tokyo is counting on Rapidus at a time when soaring demand for the chips critical to AI development is squeezing supplies of memory and other semiconductors around the world.
Production of cutting-edge semiconductors is technically challenging and expensive. TSMC this year is planning to allocate more than $50 billion in capital expenditures, with no other competitors coming close to winning as many AI accelerator orders.
Rapidus, which targets an initial public offering around fiscal 2031, aims to secure roughly $19 billion in private-sector financing partly with the help of government loan guarantees, the Japanese ministry said.
It has set up an analysis facility in Chitose, Hokkaido, to test and diagnose Rapidus’ chips in an attempt to lift yields, and has also begun operations of a backend processes development center.
