Tokyo approved ¥631.5 billion ($4 billion) in fresh subsidies for Rapidus on Saturday, pushing total government funding for Japan's flagship chipmaker past $16 billion.
The four-year-old startup now has ¥2.35 trillion ($16.3 billion) in cumulative R&D support through March 2027. An external committee inspected the company's foundry in Chitose, Hokkaido, and signed off on its progress.
Eight backers, one moonshot
Rapidus was founded in 2022 to give Japan something it hasn't had in decades: a cutting-edge logic chip foundry. The target is 2-nanometer semiconductors, the same node class TSMC began mass-producing last year.
Pilot production at the Hokkaido facility is expected in late 2026. Fujitsu is the first commercial anchor client. Toyota, Sony, NEC, SoftBank, Denso, Kioxia, NTT, and MUFG round out the eight corporate backers.
The fresh capital will fund chip development for Fujitsu and IBM Japan. Tokyo's industry ministry also approved semiconductor design support for both companies, with the goal of routing their production through Rapidus.
Private-sector money is flowing too. In February, Rapidus raised about ¥160 billion from corporate investors, with the government pledging another ¥250 billion on top.
Takaichi's security bet
Prime Minister Sanae Takaichi has put semiconductor investment at the center of Japan's national security policy. Sino-Japanese tensions and the global chip supply scramble add weight to the argument. Japan wants domestic capacity for defense systems, AI infrastructure, and supply chains that currently depend on Taiwan and South Korea.
The $16.3 billion total makes Rapidus one of the most heavily funded chip projects worldwide. Intel's CHIPS Act package came to $8.5 billion. Rapidus targets profitability by fiscal 2030 and an IPO by 2031.
A startup founded in 2022 racing to match what TSMC spent three decades building. The price tag tells you how seriously Tokyo is taking the bet.
Sources: Bloomberg, Nikkei Asia, DealStreet Asia, Business Times SG
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