Japan's Rapidus Corp. Creates First Chip Prototype with Public Funding

Japan's Rapidus Corp. has prototyped an advanced chip using 2-nanometer gate-all-around process technology, an early step in the government-backed startup's attempt to leapfrog years of innovation with billions of dollars in public funding. The company aims to be ready to help customers with their chips by March and mass produce cutting-edge semiconductors by 2027. Japan has earmarked over ¥1.72 trillion ($11.6 billion) for Rapidus as part of a moonshot bid to manufacture bleeding-edge chips at home.

Rapidus, a government-backed startup in Japan, has made significant strides in the semiconductor industry by successfully producing the first 2-nanometer transistor in the country. This achievement marks a crucial milestone in Japan's effort to restore its advanced chip-making capabilities, a project backed by ¥1.72 trillion ($11.6 billion) in public funding [1].

Rapidus' announcement, made on July 18, 2025, highlights the company's progress in developing cutting-edge semiconductor technology. The 2-nanometer gate-all-around process technology is a key advancement that could help Japan leapfrog years of innovation. The company aims to be ready to help customers with their chips by March 2026 and to mass produce cutting-edge semiconductors by 2027 [1].

This development comes at a time when the global semiconductor industry is witnessing significant growth, driven by insatiable demand for AI and high-performance computing (HPC) chips. Taiwan Semiconductor Manufacturing Co. (TSMC), a leading player in the industry, reported a record-breaking second-quarter performance in 2025, with net profit surging by 61% year-on-year and revenue climbing by 38.65% [2]. TSMC's dominance in advanced process nodes, such as 3nm, 5nm, and 7nm, underscores the importance of advanced semiconductor technology in meeting the demands of the AI revolution.

Rapidus' success in producing 2-nanometer transistors is a step towards Japan's goal of becoming a significant player in the global semiconductor market. The company's progress aligns with Japan's broader strategy to reduce its reliance on foreign semiconductor manufacturers and to establish a robust domestic semiconductor industry.

For investors, Rapidus' achievements present an opportunity to gain exposure to the rapidly growing AI and semiconductor markets. However, the company's success will depend on its ability to attract customers and scale its production capabilities. As Japan continues to invest heavily in its semiconductor industry, Rapidus' progress could have significant implications for the global tech supply chain.

References:
[1] https://asia.nikkei.com/Business/Tech/Semiconductors/Japan-s-Rapidus-touts-2-nm-milestone-in-race-to-catch-TSMC-Samsung2
[2] https://www.ainvest.com/news/taiwan-semiconductor-manufacturing-ai-driven-earnings-surge-implications-global-tech-supply-chain-2507/