Rocket Lab signs preliminary terms for $23.9M in proposed CHIPS Act funding

Rocket Lab (NASDAQ:RKLB), the parent company of space power provider SolAero Technologies, has signed a non-binding preliminary memorandum of terms (PMT) with the U.S. Department of Commerce to receive up to $23.9M in direct funding under the CHIPS and Science Act.

The proposed CHIPS investment would enable the aerospace firm to increase its production of compound semiconductors for spacecraft and satellites, as part of an expansion and modernization of its facility in Albuquerque, New Mexico. The expansion project is expected to boost Rocket Lab’s (RKLB) compound semiconductor production by 50% within the next three years.

Rocket Lab (RKLB) is one of two companies in the U.S. that specialize in the production of space-grade solar cells. The company’s space-grade solar cells power important U.S. space programs, such as missile awareness systems and exploratory science missions, including the James Webb Space Telescope, NASA’s Artemis lunar explorations, the Ingenuity Mars Helicopter, and the Mars Insight Lander.

“Solar cells are important for keeping our communication and space technology powered and operational, and this proposed award would help our military, NASA, and our commercial space industry have access to the specialty semiconductors they need to keep our country safe and continue to lead in scientific discoveries and space commerce,” said U.S. Secretary of Commerce Gina Raimondo.

The proposed investment would also create over 100 direct manufacturing jobs.

The announcement with Rocket Lab (RKLB) is the tenth PMT announcement the Department of Commerce has made under the CHIPS and Science Act, with additional announcements expected to follow throughout 2024.