GlobalFoundries sees ‘strong’ demand for Chinese optical modules amid data centre boom

US contract chipmaker GlobalFoundries is experiencing a surge in demand for Chinese optical modules, as the country's data centre construction boom gains momentum. Shankaran Janardhanan, senior vice-president of GlobalFoundries' photonics and radio frequency division, confirmed to the South China Morning Post that the company sees "strong" demand in the optical networking module segment.

This surge in demand has prompted the firm to heavily invest in photonics, according to Janardhanan, who spoke at the company's recent annual tech summit in Shanghai.

Chinese optical module manufacturers are now shipping extensively to US hyperscalers like Microsoft, Amazon, and Meta Platforms, as these companies transition data standards rapidly from 100 to 200 gigabits per second per lane. This shift is creating new opportunities for GlobalFoundries, which specializes in designing semiconductors for data centres, automobiles, and other systems. The firm aims to establish itself as a key supplier to Chinese optical module producers.

The industry remains divided on the dominant data centre standard, with pluggable modules, near-packaged optics (NPO), and co-packaged optics (CPO) being debated. Janardhanan emphasized that manufacturing and testing optics at scale is the primary challenge, regardless of the chosen standard. GlobalFoundries has addressed this challenge by launching solutions in silicon photonics and advanced packaging, including its silicon photonics co-packaged advanced light engine, or "Scale," designed to enable mass production of complex components.

China has rapidly advanced in deploying real-world physical AI, with the country's rapid physical AI deployment cited by Janardhanan as a significant market opportunity. The firm has been operating in China for 12 years and is expanding its manufacturing footprint in the country, recently opening a new office in Guangzhou to deepen a manufacturing partnership with local foundry Zen Semi, focusing on 40-nanometre automotive chips.

This partnership demonstrates GlobalFoundries' commitment to local manufacturing in China and highlights the company's ability to balance regionalization with global supply chain resilience.