Advancing Canada's capacity in photonic semiconductors and AI innovation

Government of Canada announces future spin-off of the NRC's Canadian Photonics Fabrication Centre to expand domestic photonic semiconductor manufacturing capacity

OTTAWA, ON, May 4, 2026 /CNW/ - Today, the Honourable Mélanie Joly, Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions, announced that work will begin to spin off the National Research Council of Canada (NRC)'s Canadian Photonics Fabrication Centre (CPFC) into a commercial entity with firmly Canadian foundations and with Canadian industrial development at its core. Photonics technology is a central part of the Government of Canada's plan to build up our country's advanced manufacturing sectors and sovereign capabilities, including in auto, defence, aerospace and AI.

As the global demand for AI technologies increases, photonic devices will play an increasingly important role in addressing challenges associated with performance, power and heat in large data centres and AI compute facilities. By strengthening domestic photonics capabilities, Canada can enhance its economic resilience, safeguard its technological sovereignty and secure a leadership role in the compound semiconductor industry.

Budget 2025 indicated that the Government of Canada would explore options to seek private capital to scale the operations of the CPFC to serve as a platform for Canadian innovation and new photonic applications.

As North America's only end-to-end pure play compound semiconductor facility, the CPFC plays a critical role in Canada's innovation ecosystem. Over the past 2 decades, the CPFC has evolved into a key industrial partner for Canada's growing photonics ecosystem. Through design, refinement, fabrication and testing of compound semiconductor wafers, the CPFC works with companies across the photonics industry to bring their products to market.

The CPFC will continue to be anchored in Canada and create high-quality jobs for Canadians. The future spin-off will attract private-sector capital to scale the CPFC's operations, expand the Canadian supply chain of photonic manufacturing capabilities and provide more effective and timely services to fast-growing, innovative Canadian small and medium-sized enterprises at the forefront of AI compute and quantum technologies. The Government of Canada is taking action to strengthen Canada's competitiveness and leadership in next-generation technologies that will drive growth, enhance resilience and bolster national security.

Quotes

"Spinning off the Canadian Photonics Fabrication Centre will strengthen Canada's leadership in photonics innovation. This will attract private-sector investment and create new opportunities for Canadian companies to expand the development of critical technologies that protect our sovereignty and drive productivity and economic growth."

-- The Honourable Mélanie Joly, Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions

"The National Capital Region is the heart of Canada's photonics and semiconductor ecosystem, where companies develop the advanced technologies driving our AI and digital economy. By spinning off the CPFC, we are anchoring that expertise right here--fueling private investment, supporting innovative Canadian firms, and securing leadership for our region and our country in a highly competitive global market."

-- The Honourable Jenna Sudds, Parliamentary Secretary to the Minister of Government Transformation, Public Works and Procurement and to the Secretary of State (Defence Procurement) and Member of Parliament for Kanata

"Photonics is a cornerstone of Canada's innovation future, driving advances in AI, quantum technologies, sensors, medical devices and advanced electronics--all vital to our national security and prosperity. With a strong industrial base of ambitious businesses and 20 years of CPFC leadership, Canada is ready to build on this foundation and position its photonics industry for global success."

-- Mitch Davies, President, National Research Council of Canada

Quick facts

• The NRC's Canadian Photonics Fabrication Centre is the only end-to-end pure play compound semiconductor facility in North America and is critical to the semiconductor laser supply chain.
  
  
• For over 20 years, the CPFC has worked with clients from start to finish on design refinement, creation, testing and fabrication of wafers to bring their ideas to market.
  
  
• The CPFC has been working with clients worldwide to transform compound semiconductor materials into photonic devices that underpin technologies we use every day.
  
  
• The CPFC's custom photonic components and photonic integrated circuits are used in various applications, including AI data centres, military, defence technologies, high-performance computing, telecommunications equipment, sensing, quantum technologies and more.
  
  
• The global AI market, valued at more than 338 billion CAD in 2025, is projected to grow up to 35 percent annually through 2033, driving rapid expansion in AI compute and photonics technologies. With access to the CPFC's advanced fabrication facilities, Canadian innovative firms will be well-placed to capture a large share of this high-growth market.

Associated links

• Backgrounder: Future spin-off of the NRC's Canadian Photonics Fabrication Centre
• National Research Council of Canada
• Canadian Photonics Fabrication Centre
• Canadian Photonics Fabrication Centre – YouTube video

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SOURCE National Research Council Canada

Contacts: Gabrielle Landry, Deputy Director, Media Relations, Office of the Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions, [email protected]; Media Relations, Innovation, Science and Economic Development Canada, [email protected]; Media Relations, National Research Council of Canada, 613-991-1431, 1-855-282-1637, [email protected]