Coherent Corp., a global photonics company and key supplier to Nvidia, has taken a step toward a major expansion of its semiconductor manufacturing footprint in Sherman, Texas. The company has signed a letter of intent with the U.S. Department of Commerce for up to $50 million in direct funding under the federal CHIPS and Science Act. The prospective federal support is intended to help fund the growth of Coherent’s 6-inch Indium Phosphide semiconductor manufacturing facility in Sherman.
The planned project will substantially increase production capacity at the site. Coherent intends to double its manufacturing production space at the facility, expanding from 70,000 square feet to 140,000 square feet. Alongside the physical expansion, the company expects to quadruple wafer production capacity. According to the company, this increase is aimed at significantly boosting domestic output of critical technologies that enable artificial intelligence applications.
The CHIPS and Science Act funding would add to state and local support already committed to the Sherman facility. Coherent previously received $20 million from the Texas Semiconductor Innovation Fund and the Sherman Economic Development Corporation. While these contributions represent only a portion of the capital needed for the planned expansion, they form part of a broader funding package that underpins the project.
In addition to increasing semiconductor production, the expansion is expected to have a meaningful employment impact in the Sherman area. At full project completion, Coherent projects that the site will support more than 1,000 jobs. This total includes more than 550 direct advanced manufacturing, engineering, and technical positions tied to the expanded operations at the wafer plant.
Coherent positions the Sherman project as a way to reinforce U.S. capabilities in technologies that support the AI economy. By expanding domestic Indium Phosphide wafer production, the company aims to strengthen the supply chain for AI-enabling photonics components and support continued leadership in this segment of the technology sector.
