xLight raises $40 million to build powerful chip-making laser

US startup xLight has raised USD 40 million in a Series B round, with the aim to build the first prototype of a new type of laser that could potentially reclaim US leadership in an area China is heavily investing in. 

The round was led by Playground Global, an early-stage venture capital firm investing in entrepreneurs who have developed breakthroughs in frontier technologies, and joined by Boardman Bay Capital Management, a leading investment manager specializing in high-growth opportunities across transformative technology subsectors. 

Morpheus Ventures and others also joined the round. This funding further enables xLight to develop the world’s most powerful extreme-ultraviolet (EUV) free electron lasers (FEL), which will revolutionize advanced semiconductor manufacturing and unlock other critical economic and national security applications, the California-based company said a media release.

“xLight is on a mission to build a transformational new light source for semiconductor manufacturing that addresses the key challenges facing the industry today — cost, capabilities, and capacity. This round will equip the company with the capital needed to complete detailed design and kickstart construction of our full-scale prototype,” said Nicholas Kelez, CEO and CTO of xLight. “Advanced semiconductor manufacturing is approaching a key inflection point — together with our partners across the National Lab and semiconductor ecosystem, and with the support of our investors, we will commercialize free electron lasers and help reclaim American leadership in semiconductor manufacturing.”

“By delivering an energy‑efficient EUV laser with tenfold improvements over existing technologies, xLight has the potential to drive the next era of Moore’s Law — keeping chip scaling alive, accelerating fab productivity, and anchoring this foundational capability in the US supply chain,” said Pat Gelsinger, Executive Chairman of the Board, xLight and General Partner, Playground Global. 

“xLight’s breakthrough technology delivers a real edge for next-generation semiconductor manufacturing,” said Peter Barrett, General Partner and co-founder at Playground Global. “With AI driving unprecedented demand for more powerful and complex chips, the industry needs a step change in productivity. By applying proven accelerator physics in a novel way, xLight’s EUV FEL platform has the potential to enable not just more efficient production, but entirely new kinds of devices.”

“We believe the semiconductor manufacturing industry is on the precipice of the next major dislocation and xLight is perfectly positioned to capitalize on that shift,” said Will Graves, Chief Investment Officer, Boardman Bay Capital Management. “The company’s platform has the potential to reshape how fabs think about light, manufacturing capabilities, and scalability.”